MiniMed Group Inc. reached an unusually high level of short interest on October 7, with 99% of its public float sold short, according to an estimate from data provider Ortex.
Protos said the Nasdaq-listed medical technology company saw short interest rise sharply from 47.6% on September 15 and 77% a week earlier. By October 7, the figure had climbed to a point where almost the company’s entire publicly tradable float had been borrowed and sold short.
Ortex tracks live short-interest estimates for public companies and updates its figures daily using securities-lending data, often ahead of the twice-monthly exchange reports. Based on data from securities lenders, shares of MiniMed common stock on loan nearly matched the company’s full float, while stock still available to borrow stood at only 0.08% of short interest.
A Medtronic share exchange sits at the center of the setup
Protos traced the anomaly to Medtronic, the company that incubated MiniMed. Before MiniMed’s March 2026 IPO, the business operated as Medtronic’s diabetes unit.
As of September 14, Medtronic still owned 90% of MiniMed and was offering a tax-free exchange of 225.3 million shares of MiniMed common stock, trading as MMED, for Medtronic common stock, MDT.
The mismatch in float size is central to the trade. Medtronic has 1.28 billion shares in its float, enough to support the transaction while maintaining orderly trading. MiniMed, by comparison, has a float of only 28.5 million shares. Protos said the MiniMed shares tied to the offer were about seven times larger than MiniMed’s entire tradable supply.
The exchange was not structured on a 1:1 basis. Medtronic set an upper cap of 4.5939 MiniMed shares for each Medtronic share. Even with that cap, the 225.3 million shares in the offer still exceeded MiniMed’s float by a wide margin. Unless extended, the offer was set to expire at midnight on Friday, making Thursday the key trading window.
Protos also noted that Medtronic retained most of MiniMed’s equity. MiniMed’s float began trading in the public market when Medtronic offered 28 million shares in the IPO. Medtronic still held another 253 million restricted MiniMed shares.
How the arbitrage trade pushed short interest higher
Protos described the arrangement as a textbook arbitrage opportunity. Before the Friday deadline, investors could buy Medtronic shares, tender them into the offer, and short the MiniMed shares they expected to receive in return.
Because Medtronic is a large and credible issuer, Protos said the transaction was expected to go through. The main variable for traders was how close the final conversion ratio would come to the 4.5939:1 upper limit.
Barron’s reported on October 2 that MiniMed had fallen about 12% since the eve of Medtronic’s offer, and said selling by arbitrage traders was the likely reason for the decline.
Protos framed the trade in simple terms: slightly less value in Medtronic stock could buy slightly more value in MiniMed stock, leaving a narrow premium for arbitrageurs to capture.
For traders shorting MiniMed, the process was straightforward. They could buy Medtronic shares, use the exchange to obtain MiniMed shares, then deliver those shares to repay stock loans and close out their short positions at a profit.
That incentive, Protos said, helps explain why short sellers absorbed nearly all available MiniMed borrow. Their expectation was that Medtronic’s share conversion would settle within the next few trading days, allowing them to repay borrowed stock and complete the trade with a small gain.