TORONTO (Reuters) - Canada"s Alimentation Couche-Tard (ATDb.TO) offering $1.85 billion for Casey"s General Stores (CASY.O) on Friday in a move to enhance the participation in the United States, but the aim association deserted the suggest as opportunistic.
The $36-a-share bid by Couche-Tard, Canada"s largest preference store operator, is approaching to pull opposition bids from in isolation equity supports for Ankeny, Iowa-based Casey"s.
Couche-Tard, that already has 3,600 stores in the United States, pronounced it would take the suggest without delay to Casey"s shareholders if the house unsuccessful to recur the rejection.
The suggest cost represented a fourteen percent reward over Casey"s Thursday shutting cost of $31.59 on Nasdaq.
Shares of Casey"s, that has about 1,500 preference stores in the Midwest, rose twenty-four percent to $39.17 on Friday, suggesting investors design a higher suggest to in the future emerge. Couche-Tard shares were up 1.1 pct at C$18.40 on the Toronto Stock Exchange.
The bid "is as well low a cost and there is not sufficient of a reward over where the batch has traded in new history," pronounced Todd Vingers, a income physical education instructor at Lee Munder Capital in Boston, that owns 1.3 percent of Casey"s. "As a take-out it is really value some-more than the $36 bid."
Vingers pronounced he could see deep-pocketed in isolation equity firms stepping up with higher offers.
"You could potentially see in isolation equity with an LBO -- those are alternative vital options on top of these guys," he said, referring to the probability of a leveraged buyout. "I"m not certain there are a lot of vital buyers."
Brent Rystrom, an researcher at Feltl and Co in Minneapolis, Minnesota, pronounced Couche-Tard would have to pacify the suggest almost if it wants to competition with in isolation equity players.
"We hold it is expected Casey"s could find a in isolation equity customer in this range," he wrote in a note. "Alimentation competence have to have an suggest in additional of $41 to essentially close a deal."
Couche-Tard, that has grown usually by acquisitions over the years, has done no tip that it is on the stalk for some-more deals in the United States. It told analysts that it was seeking for an additional big buy identical to the $804 million squeeze of the Circle K chain, that it sealed in 2003.
Casey"s operates preference stores and gasoline stuffing stations in the Midwest underneath the Casey"s General Store, HandiMart and Just Diesel banners.
Couche-Tard operates 3,600 preference stores in the United States underneath the Circle K ensign and some-more than 5,400 underneath the Mac"s name in Canada.
It in jeopardy to take the bid without delay to Casey"s shareholders if the house refuses to co-operate.
"If you go on to exclude to rivet in suggestive negotiations, we are rebuilt to contention the offer without delay to your shareholders and embark a substitute competition to reinstate your house of directors," Alain Bouchard, Couche-Tard, boss and arch executive, pronounced in a minute to Casey"s board.
Casey"s house appeared dynamic to put up a fight, however.
"We hold the timing of your offer is really opportunistic, since the stroke of the retrogression and new serious continue inside of the selling territory," Casey"s boss and arch executive, Robert Myers, pronounced in a letter.
"The fourteen percent reward of your offer to the shutting batch cost yesterday, underscores that you are attempting to take U.S. companies on the cheap."
(Reporting by Scott Anderson; modifying by Frank McGurty and Rob Wilson)
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