Alimentation Couche-Tard Inc. (TSX: ATD.B) reported today that it has entered into a private agreement with a corporation controlled by its founder and executive chairman Alain Bouchard to repurchase Class B subordinate voting shares. The share buyback transaction with Développements Orano is expected for a total consideration of approximately $300 million.
Under the agreement, the company will repurchase 6,351,895 Class B shares held by Développements Orano at $47.23 per share. The transaction is part of the company’s ongoing normal course issuer bid commenced on April 26, 2021, in which it was authorized to repurchase up to 32,056,988 Class B shares for a year.
The convenience store chain formed a special committee of independent directors among its board to decide on the repurchase. After consultations with legal advisor Norton Rose Fulbright Canada and financial advisor Scotiabank, the committee recommended the transaction which the company board ultimately approved.
“This transaction represents a unique opportunity for Couche-Tard to repurchase shares at an attractive price, which will create value for all shareholders,” said Eric Boyko, director and chair of the special committee.
Bouchard will see his stake in the company dip to 35.1% from 35.3% prior to the repurchase. The company said that the founder entered into the transaction for “estate planning purposes”.
The firm also said the repurchase will be paid using “cash on hand or other available financing sources”.
Alimentation Couche-Tard last traded at $48.19 on the TSX.
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