An institutional investor who supported Gildan’s directors earlier this year during the power struggle that led to Glenn Chamandy’s return to the CEO role has just significantly reduced its stake in the Montreal clothing manufacturer.
Coliseum Capital Management – one of the five largest shareholders of Gildan – sold more than $120 million worth of company stock this summer. The Connecticut-based private equity firm that backed the directors who fired Glenn Chamandy sold a total of 2.3 million Gildan shares between July 3 and Aug. 20.
A filing with the Securities & Exchange Commission shows that the stock sales pushed Coliseum Capital’s stake below 5%. The firm made its sales this summer at prices ranging from $52 to $59.
Following the rejection this week of the purchase offer of Late Night by the owner of 7-Eleven convenience stores, the question now is how the Laval company will respond. The chances seem good that Couche-Tard will come back with an improved offer. Knowing that Seven & i has been under pressure from shareholders in the recent past to boost the company’s value, Couche-Tard could decide to make a hostile bid if an amicable agreement cannot be reached.
In a scenario where a hostile bid is filed, greater volatility could hit Couche-Tard’s stock given the likelihood of multiple reversals of fortune before a solution is found, believes analyst Martin Landry of the firm Stifel.
As a reminder, analyst Chris Li at Desjardins Securities points out that when he tried to buy the Australian Caltex Four years ago, Couche-Tard had increased its offer by about 10% on two occasions. In the end, Couche-Tard decided to abandon this acquisition project.
The name of the metal frame manufacturer in Terrebonne ADF Group was added this week to a short list by Atrium Research of Canadian small-cap stocks most likely to be the subject of a privatization offer.
Despite the increase in private equity transactions over the past year in the country, Atrium Research remains convinced that there are still many stories that are misunderstood and overlooked by investors among small-cap stocks.
To be included in Atrium’s list, the stock must be well off its all-time high, the stock must be cheap relative to its U.S. and international peers, the company must be profitable, growing and benefiting from tailwinds. A company must also have a market capitalization of more than $30 million to be considered.
Quebec titles of Quebecor, Metro, Haivision, Transcontinental, Power Corporation, 5N Plus, Gildan, iA Financial Group, Héroux-Devtek And Savaria all hit 52-week highs on the Toronto Stock Exchange this week.
On the other hand, those of Coveo and of MTY Group fell this week to a 52-week low.