Dec 13 (Reuters) - Shares of High Liner Foods Inc HLF.TO HLF.A rose as much as 12 percent on Monday, after the frozen seafood processor revealed plans last week to buy Viking Seafoods Inc for $31.5 million to increase its market share in the U.S. food service industry.
High Liner shares, which have gained 85 percent in value in the past one year, touched an 18 year-high of C$16.98, before paring some of their gains to trade at C$16 Monday morning on the Toronto Stock Exchange.
On Friday, High Liner had said its buy of Massachusetts-based Viking, expected to close next week, will add to its earnings in 2011. [ID:nSGE6B90BG]
“This transaction puts High Liner close to the top position (in the North American value added foodservice market),” Dundee analyst Carolyn Dennis wrote in a note to clients. She added that the deal will help High Liner gain significant market share.
Dennis raised her price target on the company’s stock by C$2 to C$17, and said she sees more consolidation by the Nova Scotia, Canada-based High Liner. “We continue to believe High Liner is well positioned to continue its modest growth despite rising costs,” she added. (Reporting by Arnika Thakur in Bangalore; Editing by Jarshad Kakkrakandy)