A roundup of some of the North American equities making moves in both directions today
On the rise
Canfor Corp. (CFP-T) jumped almost 74 per cent on Monday after a company controlled by B.C. billionaire Jim Pattison announced plans to take forestry firm private with a $981.7-million cash offer that comes during an industry slump.
Great Pacific Capital Corp. is offering $16 a share for Vancouver-based Canfor’s stock that it doesn’t already own, or 82 per cent higher than the close of $8.80 on Friday.
In a research note released Monday, Raymond James analyst Daryl Swetlishoff said: “With the Pattison Group owning a majority interest the possibility of an unsolicited offer always seemed the likely end game for Canfor. With the industry facing a number of headwinds in recent months, shares have traded down sharply, we expect this bid to showcase value and provide a lift to the beaten down sector.”
“The proposed transaction provides evidence that value remains in the sector and that ‘smart’ long term money sees value. Should the bid proceed as offered and Canfor goes private, this removes one of the largest North American lumber names from public markets. We expect some Canfor capital to be ‘recycled’ pushing shares of the few remaining public companies including West Fraser, Interfor and Western Forest higher.”
Canopy Rivers Inc. (RIV-X) increased 7.4 per cent after announcing that it has received conditional approval to graduate to the Toronto Stock Exchange from the TSX Venture Exchange.
“This represents another important milestone for Canopy Rivers and demonstrates the Company’s continued growth and commitment to driving shareholder value,” said Narbe Alexandrian, CEO of Canopy Rivers, in a release. “We believe that a TSX listing will substantiate our strong commitment to corporate governance and provide us with exposure to a broad new investor base that will enhance liquidity.”
On the decline
Shares of Barrick Gold Corp. (ABX-T) lost 0.7 per cent after its profit rose in the second quarter as it reached a deal to end a multiyear standoff between its subsidiary Acacia Mining PLC and the Tanzanian government.
Toronto-based Barrick reported a net profit of US$194-million, compared to US$94-million loss in the same quarter in 2018. On an adjusted basis, the miner reported earnings per share of US$0.09, in line with analyst’s expectations.
Shares of CBS Corp. (CBS-N) lost 1.8 per cent and Viacom Inc. (VIAB-Q) dipped 4.9 per cent after sources told Reuters that they are in the final stages of negotiation of an all-stock merger that values the latter at a discount to its closing price on Friday.
Viacom shareholders will receive just above 0.595 CBS shares for each share they own, the sources said, adding that the final terms could still change.
CannTrust Holdings Inc. (TRST-T) continued to slide, dropping 27.8 per cent after it announced it received a report from Health Canada notifying the company that its manufacturing facility in Vaughan, Ont. has been rated non-compliant with certain regulations. CannTrust stated that is has accepted Health Canada’s findings “and remedial actions are underway.”
The company said Health Canada’s rating was based on observations made during an inspection completed from July 10-to-16.
Air Canada (AC-T) dipped 1.7 per cent after revealing it will spend more to buy Transat A.T. Inc. (TRZ-T) upping its total offer by $200-million and winning the support of the tour company’s largest shareholder.
The new deal sees Air Canada spending $18 per share, rather than $13, bringing the total offer to roughly $720-million, up from a previously announced bid worth $520-million.
Transat shares were up 42.1 per cent.
Desjardins Securities analyst Benoit Poirier said: “Overall, we are pleased with the revised offer for TRZ as we believe it fully reflects the full potential of the transaction for AC. We therefore expect investors to vote in favour of the proposed transaction at the shareholder meeting scheduled for August 23. The proposed transaction was previously expected to close in 1H20 upon receipt of the necessary regulatory approvals."
NFI Group Inc. (NFI-T) was down 2.5 per cent despite announcing subsidiary New Flyer of America Inc. has gained a new contract for 75 clean-diesel, forty-foot Xcelsior heavy-duty transit buses for Pace Suburban Bus, which is the local public transportation agency for the Chicago area suburbs.
The new fleet will replace older buses currently in operation.
Before the bell, the company reported revenue and adjusted earnings per share of $637.6-million and 48 cents, respectively. Both missed the consensus projections on the Street ($656-million and 47 cents).
The company now expects adjusted EPS of between $1.68 and $1.83 for the fiscal year, down from $1.87 and $2.11. The Street had anticipated $1.87.
“The expected revenue and Adjusted EBITDA ranges reflect the impact of negative foreign exchange fluctuations, a historically low Betting Net Win Margin in the first quarter for the United Kingdom segment, the slower than planned recovery in certain disrupted markets and some delays in launching The Stars Group’s newly licensed operations in certain jurisdictions, such as Switzerland,” the company said.
After releasing weaker-than-anticipated results after the bell on Friday, Lundin Gold Inc. (LUG-T) was down 9.3 per cent.
The miner reported a loss of US$30.8-million or 14 cents US per share in the second quarter, versus a profit of US$19.7-million or 9 cents US per share a year ago. Analysts were expecting a loss of 4 cents US in the latest quarter
With files from Niall McGee, Brent Jang, Brenda Bouw and wires