Alimentation Couche-Tard's mega $7.7-billion fuel station bid has investors filling up on stock
Source The Financial Post
Alimentation Couche-Tard Inc., North America’s largest convenience
store owner, chalked up its highest stock price this week as solid
quarterly results combined with a takeover bid for Asian expansion.
Laval, Quebec-based company has made a $7.7 billion proposal — its
largest ever — to buy Caltex Australia Ltd., which has 800 fuel stations
and shops. Couche-Tard this week reported second quarter profit rose
21.5 per cent to US$579.4 million compared with US$477 million a year
Same store sales in the U.S. expanded 3.2 per cent among
its Circle-K brand outlets, beating some expectations. Couche-Tard has
some 9,800 convenience stores in North America and thousands more from
Scandinavia to New Zealand.
The stock hit an all time high of $44.50 on the Toronto Stock
Exchange Nov. 28 before easing to $43.88 on Friday, showing how analysts
and investors are backing the giant retailer’s plans.
acquisition, if consummated, would bring Couche-Tard into a new
geography and serve as a platform for further expansion into the
Asia-Pacific region,” Mark Petrie and Krishna Ruthnum, analysts at CIBC
in Toronto, wrote in a Nov. 28 report. The duo raised its target price
on the stock to $50 and kept its outperformer rating.