Canadian Tire offer to take over the
countries leading sporting goods retailers. Forzani Group Ltd, for $771 million
in cash as it looks to battle rising in computation from U.S rivals.
Currently Canadian tire acquire 4 %
of Forzani shares, offered $26.50 for each share. This transaction will
establish Canadian tire Canada’s ultimate in sports, with 1000 combined retail
sports outlets across the country. Canadian Tire will operate Forzani retails
with the separate brand with separate unit and banner .Forzani Group operates
more the 500 different stores in all our Canada under the banner of sports
check.
Forzani’s board approved the offer
and its senior officer and director, who collected about 8.24 percent of stock,
have agreed to vote in favour of the deal. Canadian tire 35 million of saving
and expected 25 million in 2012 and rest will finance the deal with C $500
million of cash on hand and rest will short term financing. The expected
closing date of deal is the third quarter of 2011 year
Shares of Canadian Tire closed at
C$71.30 while those of Forzani Group closed at C$17.61 on Friday on the Toronto
Stock Exchange. Forzani is a perfect fit for Canadian Tire family and will
extend our reach to new customer. Canadian tire sold only basic equipment’s
such as skates board and bikes, but after taking over the Forzani will allow it
attract customer from 18 to 35 olds who tend to shop in malls for more specific
equipment’s.
This decision of buying Forzani will
make Canadian Tire owner of the No. 1 and No. 2 sporting goods retail chains in
the country.
Is the transaction between the
Canadian Tire and Forzani group helps to compete against their competitors?
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