Anti-trust Fears Kill Takeover

Article Excerpt

SHAWCOR LTD. $19 (Toronto symbol SCL.A; Aggressive Growth Portfolio, Manufacturing & Industry sector; SI Rating: Average) has dropped its plan to acquire Garneau, Inc. due to regulatory concerns that the deal would give ShawCor too much control over Alberta’s pipeline coating industry. Garneau would have only accounted for a small portion of ShawCor’s assets, so scrapping the takeover will let the company focus on other ways to expand. The stock got as high as $22 in May 2006, but has moved down as investors worry that lower oil prices will cut demand for ShawCor’s services. But oil prices will likely stay above historical levels indefinitely, and ShawCor’s strong reputation should help it win more pipecoating contracts. ShawCor is a buy for aggressive investors. investors…

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