Precision Down Most in Two Years After AIMCo Sale: Calgary MoverRebecca Penty and Divya Balji
Precision Drilling Corp. fell the most in more than two years after its biggest shareholder sold its entire stake in Canada’s largest drilling rig contractor.
Alberta Investment Management Corp. sold 56.6 million shares of Calgary-based Precision Drilling for C$9.50 ($8.93) to C$9.75 apiece, Leo de Bever, chief executive officer of Alberta’s largest pension-fund manager, said in a phone interview today.
Precision, based in Calgary, fell 9.1 percent to C$9.33 at the close in Toronto, the most since August 2011.
AIMCo “more than tripled our money” on Precision, formerly one of its biggest holdings, said de Bever, who described the rig company as fairly valued. “It has nothing to do with the quality of the company, which is quite good. You have to know when to buy and when to sell.”
Precision confirmed the AIMCo stake sale in a statement today. AIMCo held about 15 percent of the company’s stock at the end of the third quarter, according to data compiled by Bloomberg.
AIMCo paid C$3 a share for its stake in Precision, de Bever said. The pension-fund manager began acquiring the stock in 2008 after Precision bought a U.S. competitor and was starved for capital, he said. AIMCo provided debt and equity financing.
“AIMCo made a good trade,” Greg Dean, who helps manage a C$7.9 billion portfolio for CI Investments Inc.’s Cambridge Global Asset Management, said in a phone interview. He called the fund’s original investment in Precision “opportunistic.”