Irish drug developer Warner Chilcott has soared on news that it is being acquired, and one large trader is apparently betting that the deal will go through.

optionMONSTER's tracking systems show that 6,600 January 17 puts were sold in one print for $0.75. The volume was far above the strike's open interest of just 205 contracts before the trade appeared, clearly indicating that this is a new position.

WCRX gained 1.97 percent yesterday to close at $19.13. The Dublin-based speciality-pharmaceutical company climbed to a 52-week high of $20.75 on May 22 after both firms announced that they had reached agreement on an $8.5 billion deal pending shareholder approval, but Warner Chilcott's shares have drifted lower since then.

The put seller is looking for WCRX to stay above the $17 strike price through expiration in mid-January, after the acquisition is expected to be completed. If the stock falls below that level, the trader will be on the hook to buy shares at an effective price of $16.25 once the $0.75 credit from the put sale is included. (See our Education section)


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