Trading option bets for Little Rock, Arkansas-based Acxiom spiked six days before the $2.25bn bid ($27.10 per share) by two investment firms ValueAct Capital and Silver Lake Partners to take firm private again was publicly announced.

The surge in option calls continued unabated even though shares prices had remained steady, raising some questions about the use of inside information to inflate deals.

The contracts to buy Acxiom’s stock at $25 per share could reap large profits for shareholders after news of buyout raised the stock’s value around 18% last Thursday to $27.95, a level that not attained in over six years.

Under the terms of the deal ValueAct and Silver Lake will take a 50-50 partnership stake in the new venture, for which they will also assume about $756m in debt.

The options market, which allows traders to bet on a company’s value rising or falling, is not well understood by casual traders. In fact it offers best opportunity to hedge investments or bet on a company’s performance according to some experts. The market for options trading has exploded in the last 30 years. But the quick gains it has afforded investors has also aroused suspicion.

Now trading options of Acxiom joins a growing list of unusual activity preceding a takeover deal.

Options trading for Acxiom had witnessed heavy call options volume trading between May 10 (six days before the deal was made public) and May 14 of around 1,300 to 1,400 contracts per day, which is around 10 times its daily average call volume of less than a 100.

The options were would have been worthless had it not been for last Wednesday’s announcement of the company’s buyout at $27.10 per share.

Acxiom CEO Charles Morgan was quick to defend the deal saying that employees were made aware of the deal at the same time it went public, after the close of the market last Wednesday.

He also pointed out that the terms of takeover agreement still allowed Acxiom to consider other bids and proposals over the next two months – a so-called go shop period, something he said the board plans to actively pursue.

Right now the Securities and Exchange Commission is not commenting on the deal, but maintains that it investigates any trading activity is deems unusual or irregular.

Acxiom also refused to discuss the option trading activity, but did say that it had not been contacted by the SEC authorities as yet.

But the fishiness of the deal and the price set agreed upon has prompted Acxiom’s second largest shareholder, Cliff Lifflander of MMI Investments, to oppose the buyout.

Lifflander’s New York-based hedge fund holds around 8.2% of Acxiom’s outstanding stock. He believes that the offer of $27.10 per share by ValueAct and Silver Lake Partners was too low, even though it represents a premium of about 20% above Acxiom’s 30-day average trading price.

He said he was extremely disappointed by the possibility of a quick buyout. It’s our belief that the go-shop mechanism is a poor substitute for a full auction with a comprehensively marketed property.

But it is unlikely that MMI’s objection will have much of an impact on the deal going ahead since hedge-fund ValueAct is the Acxiom’s largest shareholder, holding around 14% of its stock.

Interestingly ValueAct was embroiled in a bitter, high-profile in 2005 and 2006 over how best to run Acxiom. At that time Acxiom’s management successfully fought off a subsequent takeover bid by ValueAct.

But both companies have since patched up their differences with ValueAct’s managing partner, Jeffrey Ubben, becoming a member of the Acxiom’s board last summer.

Acxiom specializes in customer database marketing, data integration and analysis for credit card firms, banks, retailers and telecommunications companies.

The company recently reported a 73% decline in net profits to $6.27m in its fourth-quarter, citing the closure of its Spanish business, severance costs, and other one-time charges. Revenue for the quarter ended March 31 was up 4% to $357.3m.

In truth the SEC has had limited success in weeding out and prosecuting insider trading activities. However it recently accused a couple of Hong Kong-based investors of using insider trading when they purchased $15m of Dow Jones stock before the announcement of a buyout. Like Acxiom, shares of Dow Jones rocketed after news of the potential buyout became public.

However financial analysts that track options trading options are not surprised by that, saying that use of prior insider knowledge of deals to hedge options bets is an everyday fact of Wall Street life.