Ceridian Corporation (NYSE:CEN) shares added $0.23, or 0.69%, today as investors applauded the company's decision to explore a broad range of strategic alternatives to enhance shareholder value. We know that Bill Ackman's Pershing Square initially requested that the company spin off its Comdata unit, which was an idea later supported by Relational Investors. The spin off would enable Ceridian to unload debt and cash in on its Comdata stake, while allowing Comdata to realize its intrinsic value on its own. Now that the company has agreed to explore possible alternatives, investors are just waiting for the board's decisions.

Interestingly, Bill Ackman disclosed (in a Form 4) that he purchased a million Jan '09 $24.43 American-style call options on February 12th at $9.89 a piece. These in-the-money options are convertible into common stock at a price of $34.32. Why would Ackman want in-the-money options? Well, it could be his ticket to a huge payday if the spin off ends up taking place! For only $9.89 per option, Ackman is able to guarantee himself a large stake in the Comdata entity when it is spun off to shareholders while leaving enough room to liquidate the options if it falls through. The move also gives Ackman the ability to convert the options to shares in the event he needs an additional 1,000,000 votes (ie. if management ends up rejecting his proposals). Combined, this move makes CEN a stock that is definitely putting on the radar for the next few weeks.

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