text: Ferrier proposed the following reaction mechanism:
  In this mechanism, the terminal olefin undergoes hydroxymercuration to produce the first intermediate, compound 2, a hemiacetal. Next, methanol is lost and the dicarbonyl compound cyclizes through an attack on the electrophilic aldehyde to form the carbocycle as the product.  A downside to this reaction is that the loss of CHOH at the anomeric position (carbon-1) results in a mixture of α- and β-anomers.  The reaction also works for substituted alkenes (e. g. having an -OAc group on the terminal alkene).
  Ferrier also reported that the final product, compound 5, could be converted into a conjugated ketone (compound 6) by reaction with acetic anhydride (AcO) and pyridine, as shown below.