Boucherville, Que.—Canadian hardware giant RONA has shot down an acquisition attempt by U.S.-based Lowe’s, the company announced.
After receiving an unsolicited, non-binding offer to buy all of RONA’s issued and outstanding shares at $14.50 a share July 8 from Lowe’s, the company’s board determined the offer wasn’t “in the best interest of RONA and its stakeholders.”
RONA’s shares were trading around $11.87 before the company announced it had resisted Lowe’s overtures.
According to the Quebec-based company, In its proposal, Lowe’s indicated it had communicated with a number of RONA shareholders and proposed entering into a board-supported transaction.
In light of these statements, RONA requested that Lowe’s confirm that it would not pursue a transaction that was not supported by RONA’s Board.
On July 28, 2012, Lowe’s responded that it was still its desire to proceed with a board-supported transaction.
Lowe’s also indicated that it remained very interested in pursuing a transaction with RONA and was going to consider all of its options.
“A number of institutional shareholders representing in the aggregate approximately 15 per cent of RONA’s outstanding shares have indicated that they support Lowe’s proposal,” Lowe’s said in a statment.