Canada’s TransForce to buy Contrans; shares rise

By: | at 11:21 AM | Intermodal  

Shares of Canadian trucking company TransForce Inc rose as much as 8 percent in morning trading on Friday after the company said it would buy Contrans Group Inc for about C$495 million and reported better-than-expected results.

TransForce said late on Thursday it will buy the transportation services provider for C$14.60 per share, a discount of 1 percent to the stock’s Thursday closing.

Contrans will declare a special dividend of 40 Canadian cents per share, the companies said.

Shares of Contrans rose as much as 5.4 percent to C$15.54, exceeding the offer price and the dividend combined.

“We view the acquisition favorably and expect significant synergies from the transaction,” Laurentian Bank Securities analyst Ben Vendittelli said in a note to clients.

TransForce also reported an adjusted second-quarter profit of 48 Canadian cents on Thursday, beating analysts’ average estimate of 42 Canadian cents, according to Thomson Reuters I/B/E/S. Revenue increased 12 percent to C$889.1 million, above the estimated C$885.6 million.


Discussion

Be the first to comment on this article!

To avoid Spammers, we ask that you log in using your AJOT.com account. Free accounts have access to commenting.

Did you forget your password?

It happens...