Topic: Growth Stocks

Stock Pickers Digest Hotline – Friday, April 9, 2010

Article Excerpt

ALIMENTATION COUCHE-TARD INC., $18.90, symbol ATD.B on Toronto, has launched a $1.9-billion hostile takeover bid for Casey’s General Stores (symbol CASY on Nasdaq). Casey’s owns 1,507 convenience stores in the U.S. Midwest. The stores offer a wide variety of food and non-food merchandise, as well as gasoline, under the names Casey’s General Store, HandiMart and Just Diesel. Casey’s has rejected Couche-Tard’s all-cash, $36-a-share bid as inadequate. Casey’s is now trading at $39.10, which is 8.6% above Couche-Tard’s offer. That suggests that investors expect a higher bid. Large acquisitions like this (the offering price represents 54% of Couche-Tard’s current market cap) entail significant risk. However, Couche-Tard has a proven history of successfully integrating the companies and assets that it buys. Regardless of the outcome of the takeover bid, we still see Alimentation Couche-Tard as a buy. TEMPUR-PEDIC, $30.74, symbol TPX on New York, has bought its Canadian distributor, Tempur Canada Inc., for an undisclosed sum. Before this purchase, Canada was the largest bedding market…

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