Canadian convenience store operator Alimentation Couche-Tard Inc. (ATD_A.TO,ATD_B.TO,ANCUF.PK, ANCTF.PK) on Wednesday agreed to launch a bid to buy Statoil Fuel & Retail ASA, with a focus on high growth markets of Central and Eastern Europe. The bid price is 53 Norwegian kronor per share cash, valuing the Norwegian retailer at 15.9 billion kronor or $2.8 billion. Statoil Fuel shares increased around 51% in the morning trade in Oslo.
The Scandinavian road transport fuel retailer was formed by the 2010 separation of the downstream business of Norwegian energy company Statoil ASA (STO). It has a broad retail network across Scandinavia, Poland, the Baltics and Russia with about 2,300 full-service or automated stations.
Couche-Tard's President and Chief Executive Officer Alain Bouchard said, "Moving into Scandinavia and Europe is an important step in implementing Couche-Tard's growth strategy."
Couche-Tard would commence the offer period before April 23, pending approval from the Oslo stock exchange, expecting to complete the transaction in June 2012, subject to customary closing conditions.
The company, which claims to be the largest company-operated convenience store operator in North America with about 5,817 stores, expects the deal to result in significant and immediate accretion to net earnings per share.
The per-share price, before any dividends and other distributions after December 31, 2011, represents a premium of 52.5 percent to the closing price of the Statoil Fuel on Tuesday. It also represents a premium of 31.7 percent to the volume weighted average share price for the six-month period.
The deal has gotten Statoil Fuel's Board approval. Statoil Fuel's Chairman Birger Magnus said the Board has "resolved to recommend the Offer, which we believe recognizes the strategic value potential of Statoil Fuel & Retail and delivers a considerable cash premium to our shareholders."
As per the agreement, Statoil ASA, the principal shareholder of Statoil Fuel, has committed to tender its 54 percent interest in Statoil Fuel, subject to certain conditions.
Couche-Tard expects the acquisition to give it "expanded geographic footprint, diversification and a European platform for future profitable growth."
For financing the deal, the company would use its existing credit facilities and a new 3-year $3.2 billion acquisition credit facility committed by a syndicate of banks to finance the deal.
In the deal, Couche-Tard's financial advisors are National Bank Financial, UBS, Scotiabank, HSBC, Rabobank and Bank of Tokyo-Mitsubishi.
In Oslo, Statoil Fuel shares are currently trading at 52.35 kronor, up 17.60 kronor or 50.64 percent on a volume of 4.2 million shares.
In Canada, Alimentation's A shares closed Tuesday's trading at C$35, up C$1 or 2.94 percent.
by RTT Staff Writer
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