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Bullish Leap Options Set to Gain $4.6 Million with Buyout Bid

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Some well-timed options traded on Leap Wireless International Inc. LEAP +0.36% last week could lead their buyers to make a profit of about $4.6 million following news that AT&T Inc. T -0.64% has agreed to acquire the company, according to trade data.

Some market watchers said the unusually heavy options volume in Leap, a strong bias toward bullish contracts and odd-size trades suggest the trading may have been driven by an investor, or group of investors, with knowledge of the deal before it was made public.

After the close of trading Friday, AT&T announced it had reached a deal to buy the prepaid-wireless company for $1.19 billion, a premium of about 88% to the stock's closing price that day.

Meanwhile, in the days before the bid was announced, call options, which offer the right to buy shares at a set price within a certain time and benefit from a rise in prices, were unusually active on Leap.

Ophir Gottlieb, managing director at options-data firm LiveVol Inc., said the way the options were trading in small trades over a period of time suggests the trades may have been set up by a person, or group of people, looking to "hide knowledge of inside information," while trading on that information.

Eric Hunsader, chief executive of Nanex, a provider of real-time data to traders, said trading at the end of the day Friday looked suspicious.

In the last 18 minutes of the session, "it looks like they were trying to buy everything they could get without moving the options prices," Mr. Hunsader said.

In those final minutes, he said, there were more than 2,000 call options traded without a single put option.

He called it an extreme imbalance.

A put option grants the right to sell shares at a set price within a certain time.

On Friday, and in the days before, "it was pretty aggressive trading, all in the same pattern," said Mr. Hunsader. "They would

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