RE:Could Superior buy Canwest Propane
SwissBanker96 wrote:
Pick #1
Learning from talented investors is a key component of getting better at managing your own personal portfolio. Fortunately, Marleau writes a weekly commentary that’s available for viewing on his company’s website. I recommend you avail yourself of this useful resource.
Marleau’s first pick isSuperior Plus Corp.(TSX:SPB), which is best known as one of the biggest distributors of propane in this country. He believes that the collapse of its merger withCanexus Corp.over the summer combined with the almost simultaneous sale of its construction products division for $420 million have put it back on track toward growing its two primary businesses: propane and specialty chemicals.
As a result, its balance sheet in much stronger, putting it in the perfect position to make an acquisition. Marleau sees Canwest Propane, a division ofGibson Energy Inc., as an ideal target, given that Gibson is highly leveraged with debt four times EBITDA.
https://www.fool.ca/2016/11/02/3-stocks-to-buy-from-1-of-canadas-most-successful-hedge-funds/#
I think if Superior could acquire all of Canwest they should go for it. I think Gibsons was only trying to off load its industrial portion, which doesn't have very high margins, but if the whole leg was available, Superior should definitely go for it. I live on Vancouver Island and Canwest is marketed everywhere here. Chances are if you are buying propane here coming from Canwest. Superior already has the Costco Stores on the island. They were definitely be synergies to be made that would make the deal more accretive as well. Options like these don't come around to often.