Chip Maker Options Boil on Takeover Talk

Options traders are piling into MEMC Electronic Materials as takeover rumors circulate.

The silicon wafer manufacturer averages 5,800 calls for a full session, but WFR traded more than 15,400 contracts in the first hour of Tuesday's session alone. Action is heaviest at the May 20 and May 22.50 strikes, where more than 13,000 and 5,500 calls have changed hands respectively.

Trading was also strong at the June 17.50, 19, and 20 strikes, where another 13,000 calls traded in total, according to OptionMonster's tracking systems. WFR shares are up 3 percent on the day to $18.66.

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Jon 'DRJ' Najarian is a professional investor, CNBC contributor, and cofounder of