# Please name companies you think will likely be takeover targets and by whom?



## internalaudit (Jan 27, 2017)

From what I have read:

Nexgen Energy Ltd - NXE --> likely by Cameco

Sabina Gold & Silver Corp - SBB --> rumor is Agnico Eagle Mines or some other gold producer
https://www.youtube.com/watch?v=Yn5YSr9Z7HE


Would be nice to find out what other healthy companies others think can be acquisition targets.


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## james4beach (Nov 15, 2012)

In case you're thinking of trading based on this; whatever we know, the market already knows. Any of these possibilities will already be priced in.


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## internalaudit (Jan 27, 2017)

The market is not efficient with all the insider information. 

And why do the target companies go up, majority of the time, when the announcement of an acquisition comes out? If the market was efficient, then the target wouldn't have been trading at a discount.

Also, when stock markets swoon, a lot of solid companies' stock prices take a dive too. If the news doesn't really affect the business, why does the stock price dive, only to recover quickly once investors buy the stock back up again?


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## james4beach (Nov 15, 2012)

internalaudit said:


> And why do the target companies go up, majority of the time, when the announcement of an acquisition comes out? If the market was efficient, then the target wouldn't have been trading at a discount.


The stocks go up because the entire market suddenly learns of the new information, or they learn that something that was a low probability has suddenly become a high probability. e.g. with a buyout rumour one might think there's 25% chance of acquisition. Once it's announced, there's 95% chance of acquisition.

You're asking us about rumours. Whatever rumour one of us knows, the whole market knows. You're not going to learn anything new on a message board that isn't already known to the market.


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## agent99 (Sep 11, 2013)

Maybe someone will make a low-ball offer for Sears

http://www.usatoday.com/story/money/markets/2017/03/22/lampert-sears-stock-losses/99494146/


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## AltaRed (Jun 8, 2009)

It is better left to die....really. 

Remember that Sears Canada is a completely separate company, but it is also doomed to die.....same name association and legacy.


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## My Own Advisor (Sep 24, 2012)

I agree, Sears is done.

Related subject...what do you make of this noise? <paywall>
http://www.theglobeandmail.com/glob...esting-in-retail-real-estate/article34390570/

_The share-price decline has accelerated for many REITs this month. This, of course, starts the conversation about whether there’s a buying opportunity. In this camp is Michael Bilerman of Citigroup Global Markets, who hosted a conference of REIT CEOs earlier this month just as the retail chiefs were seeing their shares continue to tumble. “We had thought the bear trade was too crowded for meaningfully more downside – apparently not. That said, there was little connection between the seeming free-fall in the shares the last few days and what we heard from retail REIT management teams.”

So management is positive....

Sorry, but this is not fake news, and it’s worth asking whether the shares have corrected enough. Andrew Rosivach of Goldman Sachs downgraded his view on the entire retail REIT sector March 17 to “cautious” and downgraded a handful of specific names – even though he said “we believe the mall is not going away and retail REITs can avoid occupancy declines.” Hmmm.

Even as we got the news on Sears Wednesday, Bloomberg also reported that shoe chain Payless Inc., which has 4,000 locations in 30 countries, is preparing a bankruptcy filing and initially plans to close 400 to 500 stores. Add that on top of the retrenchments at Macy’s, J.C. Penney and any number of other retail names.

In 2013, I opined that buying the shares of retailers such as Sears for their “hidden real estate value” was a poor idea. I generously included the views of those who disagreed, who argued that health clubs and hot-growing retailers such as Uniqlo would soak up the space vacated by the troubled companies.

I thought they were wrong then, and I’m even more sure now. And Canadians shouldn’t be so sure that the phenomenon won’t spread here. I’m talking about the holders of RioCan, which exited the U.S. in 2015; any of the REITs that stick to domestic ownership, whether via one retailer like Loblaw’s or Canadian Tire; or the REITs that are more diversified across Canada. This is a slow-motion tragedy that could easily head north, and there’s no telling right now how much physical retail we’ll need in a fully digital world. That’s my concern._

Thoughts on the death of REITs?

Personally, I don't see it and even if the decline continues this is valuable land that can be re-purposed over time for more residences.

Personally, I think CAR.UN and REF.UN could really shine in the years to come. Not everyone can afford $1M - $2M home in Toronto or Vancouver.

Back to the question, I could see consolidation in the REIT sector in the coming years. D.UN owned by another REIT for example.

Consolidations does not equal death. If anything, might be poised for growth many years out. Not everything is practical to be bought online. Somethings are needed on demand.


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## AltaRed (Jun 8, 2009)

The REIT sector is almost as diverse as the broader equity market. While all slices of the REIT sector will be affected by sentiment in the bond market, to blanket all REITs the same is perverse, if not stunning ignorance by so called experts at GS. Consolidation would be a good thing in my opinion. There are too many specialty/boutique one trick pony REITs around.


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## agent99 (Sep 11, 2013)

My Own Advisor said:


> I agree, Sears is done.


It could be, but putting out negative news, as just happened, drives share prices down. Eventually someone comes along and makes a low bid offer leaving investors having no choice other than to accept.

Sears itself is a valuable brand name as are some of it's product names like Craftsman, Diehard, Kenmore, etc. In the USA, they are the nation's largest provider of home services, with more than 14 million service and installation calls made annually.

Sears Canada may be a separate company, but it shares supply chain and brands and I think I read that Sears CEO, Edward Lampert, has a ~27% stake in Sears Canada.

So there should be considerable value there still in both companies, but just not in the big box stores. Or at least enough value for someone to make a low bid buyout.


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## Eclectic12 (Oct 20, 2010)

My Own Advisor said:


> ... And Canadians shouldn’t be so sure that the phenomenon won’t spread here. I’m talking about the holders of RioCan, which exited the U.S. in 2015; any of the REITs that stick to domestic ownership, whether via one retailer like Loblaw’s or Canadian Tire; or the REITs that are more diversified across Canada. This is a slow-motion tragedy that could easily head north, and there’s no telling right now how much physical retail we’ll need in a fully digital world. That’s my concern.[/I]
> 
> Thoughts on the death of REITs?


On one hand, I do have RioCan that is down over the year. OTOH, my other REITs are up.

I also see RioCan plazas with grocery stores in them that have dedicated spots for the "order online, pickup the order at the store" so I'm not so sure it is cut and dried as the writer thinks.




My Own Advisor said:


> ... Back to the question, I could see consolidation in the REIT sector in the coming years ... Consolidations does not equal death. If anything, might be poised for growth many years out. Not everything is practical to be bought online. Somethings are needed on demand.


Consolidations back at least a decade ago were what made me aware that REITs pay mixed income instead of 100% eligible dividends so it is not that new.


Cheers


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## nobleea (Oct 11, 2013)

agent99 said:


> Sears itself is a valuable brand name as are some of it's product names like Craftsman, Diehard, Kenmore, etc. In the USA, they are the nation's largest provider of home services, with more than 14 million service and installation calls made annually.


Sears recently sold off the Craftsman line and name to Stanley Black & Decker. 750mil and a percentage of sales going forward. I was surprised it as such a high price.


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## AltaRed (Jun 8, 2009)

nobleea said:


> Sears recently sold off the Craftsman line and name to Stanley Black & Decker. 750mil and a percentage of sales going forward. I was surprised it as such a high price.


True that Sears have been selling off their brand names to keep the ship afloat, but if they really wanted too, they could also drop the department store idea entirely and become a niche player in select areas. They've tried Sears Home but those stores are 'death in waiting' due to lack of customers so they better get out of that business and focus on where the traffic is in their stores....and re-invent themselves there.


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## internalaudit (Jan 27, 2017)

AltaRed said:


> True that Sears have been selling off their brand names to keep the ship afloat, but if they really wanted too, they could also drop the department store idea entirely and become a niche player in select areas. They've tried Sears Home but those stores are 'death in waiting' due to lack of customers so they better get out of that business and focus on where the traffic is in their stores....and re-invent themselves there.


The way Bebe is going purely online. I had to look the company up. Thought it carried a line of baby products but it's a fashion retailer.


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## GreedIsGood (Dec 4, 2013)

internalaudit said:


> The market is not efficient with all the insider information.


Insider information makes the market more efficient, no?


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## internalaudit (Jan 27, 2017)

GreedIsGood said:


> Insider information makes the market more efficient, no?


Probably not. They are selling at peaks and buying at bottoms. If info is not publicly available, then it isn't price efficient.

Market efficiency refers to the degree to which stock prices and other securities prices reflect all available, relevant information.
http://www.investopedia.com/terms/m/marketefficiency.asp


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## GreedIsGood (Dec 4, 2013)

^ Not quite sure what you mean by "If info is not publicly available, then it isn't price efficient."

This paragraph is directly from your link.

_The three versions of the efficient market hypothesis (EMH) are all based on varying assumptions of price efficiency. The weak form of EMH claims that the prices of publicly-traded assets already reflect all available information, and past prices are of little value in predicting future trends. The semi-strong version of EMH holds that while prices are efficient, they react instantaneously to new information, *while the strong version of EMH maintains that asset prices reflect not just public knowledge, but private insider information as well.*_


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## Eclectic12 (Oct 20, 2010)

You mean like the insiders who sold just be everything went to crap? 

(Corel & Nortel are a few examples)


Cheers


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## mark0f0 (Oct 1, 2016)

I think Seabridge Gold (main asset = the KSM mine near Terrace, BC) will eventually get taken out by a major. There's not a lot of nearly shovel-ready gold mining projects left in the world, and the past 5 years of low prices have resulted in very low reserve replacement in the industry.


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## Gumball (Dec 22, 2011)

I'm just speculating here but I could see CHE.UN Chemtrade get taken over by someone like Dow chem, Olin corp, etc


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## Ponderling (Mar 1, 2013)

I am working on a design build finance and operate for 35 years about 5B$ mega project. 
I am on the side of a a large team of consulting engineers working for the contractor consortium. 
From this job I got exposed to Lumenpulse and Canam.

LMP looked like it was heading towards making some money in the next few years after leaving the startup phase. 
So I bought in some at at $11.6 in the TFSA. 
Sale closed in the account on a monday, and then on friday I hear they are being bought private, and shares leap to $21.08.

Canam was going to be the next buy for the tfsa pot. Thier stock was pounded down enough it looked like up was a likely place for it to go in a quarter or two .
Well, I wont get that chance because it is now going private as well.


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## humble_pie (Jun 7, 2009)

Ponderling said:


> I am working on a design build finance and operate for 35 years about 5B$ mega project.
> I am on the side of a a large team of consulting engineers working for the contractor consortium.
> From this job I got exposed to Lumenpulse and Canam.
> 
> ...




hey. What a great story. Mille félicitations!

.


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## doctrine (Sep 30, 2011)

CBL is likely going private (really buying back their IPO shares); about 33% of the float is publicly traded, the rest being held by Catalyst private equity. Goldman Sacks was hired to do the deal. The target range is $18-22, the stock sold off after a not-great quarter to under $14 but has bounced back to $15. Timeframe is pretty soon, July likely. Of course there is no guarantee, but management has been talking it up and are negotiating with 6 or less companies in a second round of bidding for the public float. Very interesting to see how it plays out. Honestly I think the stock would have sold off much more, to $10 or lower, but imo it trades at $15 based on the likelihood of the buyout. This isn't new news, of course, it's been out there for 6 months or so, but it's a lot closer now with a decent gap to the target price.


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## Ponderling (Mar 1, 2013)

Well, I rode LMP to the end. It was sold in my account without me instigating the sale order, when I looked this morning.

And the neat thing, no commission charged on the sale.


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