Casey’s General Stores has announced in a press release that its Board of Directors, with the assistance of financial and legal advisors, has rejected an unsolicited proposal received from Alimentation Couche-Tard on 9 March 2010 to acquire Casey’s for US$36.00 per share in cash.
“The Board unanimously determined that the proposal is not in the best interests of the corporation and informed Couche-Tard on 29 March 2010 that it had rejected the proposal,” Casey’s said in the statement.
The retailer sent a to Couche-Tard saying it was “very disappointed” with the “hostile public campaign”, adding that the offer “significantly undervalues Casey’s and is not in the best interest” of the company.
Since the move Casey’s shares have since soared above US$39, suggesting that some shareholders expect a higher offer from either Couche-Tard or a rival bidder.
According to analysts, Casey’s is a good fit for the Canadian retailer since the US chain’s geographic region offers almost no overlap with Couche-Tard’s current holdings.
Furthermore, analysts claim Casey’s has relatively little debt on its balance sheet, while Couche-Tard has access to fairly cheap financing for an acquisition – a move which could drive up Couche-Tard’s earnings.
