The Jean Coutu Group Inc., Canada’s second-largest publicly traded drugstore, surged the most in 15 months after competitor Shoppers Drug Mart Corp. agreed to sell itself to Loblaw Cos. for C$12.4 billion ($11.9 billion).
Jean Coutu, based in Longueuil, Quebec, soared 4.9 percent to C$18.98 at the close in Toronto, the biggest gain since March 21, 2012. The stock has risen 31 percent this year.
Helene Bisson, a spokeswoman with Jean Coutu, said “it’s business as usual” at the company and the share price movements are probably related to the announced deal.
Analysts covering Jean Coutu have three buys, nine holds and one sell rating, according to data compiled by Bloomberg. The consensus 12-month target price among analysts is C$18.13, or 4.5 percent less than current levels.
Loblaw, Canada’s largest supermarket company by market value, will pay C$61.54 a share in cash and stock for Shoppers Drug Mart, Canada’s leading drugstore chain, the companies said today in a statement. This represents a 27 percent premium to Toronto-based Shoppers Drug Mart’s last closing price prior to the announcement.
Shoppers soared 24 percent to C$60.12, a record high, while Loblaw climbed 5.4 percent to C$50.13, the biggest gain in more than seven months.