MiniMed short interest neared 99% of float as Medtronic exchange offer fueled arbitrage

An unusual setup in MiniMed Group Inc. stock sent estimated short interest to 99% of its public float on October 7, according to Ortex. The move did not emerge in isolation. Protos tied the spike to a share exchange launched by Medtronic, which still owned 90% of MiniMed as of September 14 and was offering 225.3 million MiniMed shares in exchange for Medtronic stock. That matters because MiniMed’s float is only 28.5 million shares, far below the size of the stock being offered in the transaction. The structure created a straightforward arbitrage trade ahead of the Friday midnight deadline. Investors could buy Medtronic shares, tender them into the exchange, and short MiniMed shares they expected to receive once the conversion settled. Ortex’s lending data showed MiniMed stock on loan nearly matched the entire float, while stock still available to borrow was just 0.08% of short interest. Protos said the setup gave short sellers a clear incentive to borrow and sell nearly every available share, expecting to cover those positions with MiniMed stock delivered through the Medtronic exchange in the next few trading days.