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.
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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.
