Canada's TransForce to buy Contrans; shares rise
(Reuters) - Shares of Canadian trucking company TransForce Inc TFI.TO rose as much as 8 percent in morning trading on Friday after the company said it would buy Contrans Group Inc CSS.TO for about C$495 million and reported better-than-expected results.
TransForce said late on Thursday it will buy the transportation services provider for C$14.60 per share, a discount of 1 percent to the stock's Thursday closing.
Contrans will declare a special dividend of 40 Canadian cents per share, the companies said.
Shares of Contrans rose as much as 5.4 percent to C$15.54, exceeding the offer price and the dividend combined.
"We view the acquisition favorably and expect significant synergies from the transaction," Laurentian Bank Securities analyst Ben Vendittelli said in a note to clients.
TransForce also reported an adjusted second-quarter profit of 48 Canadian cents on Thursday, beating analysts' average estimate of 42 Canadian cents, according to Thomson Reuters I/B/E/S. Revenue increased 12 percent to C$889.1 million, above the estimated C$885.6 million.
(Reporting By Tanvi Mehta in Bangalore)
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