US: Safeway shares jump on Canadian sell-off speculation
Shares in Safeway have risen after analysts suggested that Canadian retailers could be freeing up cash in preparation for a bidding war over the US retailer's Canadian operations.
It emerged yesterday (23 January) that Metro Inc plans to sell off its stake in Couch-Tard to raise C$479m (US$482m) in funds. The news follows an announcement from Loblaw last month that it is creating a real estate investment fund to unlock some of the capital in its property portfolio.
This manoeuvring could signal that Canadian operators are looking to boost their financial flexibility in case of a bidding war over Safeway's Canadian business, BMO Capital Markets analysts speculated in a note to investors.
However, the analysts added they "have no insight as to whether a potential sale is or is not in the works".
Nevertheless, Safeway's share price spiked yesterday, rising from an open of US$18.90 to close at $19.85.
Canadian food manufacturer and retailer George Weston Limited has reported higher first-quarter profits after improved results from retail arm Loblaw....
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