Canada’s largest customs broker sold
Thursday, October 22nd, 2009 - 2:08 pm
Livingston International Income Fund, has agreed to be acquired by CPP (Canada Pension Plan) Investment Board and U.S. capital fund Sterling Partners at a cost of $273 million, or $8 per unit. The deal is contingent upon support from two-thirds of unit holders and is expected to be completed in early December 2009. Although the purchase price represents a 29% premium to Livingston units price when the offer was made in early October, the possbility exists for a competing offer.
The Globe and Mail quotes BMO Nesbitt Burns analyst Jason Granger who said it “seems low given that pension funds or other non-public players should continue to be able to exploit tax advantages from Livingston.” Today the trust units (LIV.UN - TSX) are trading 15 cents above the CPP/Sterling offer at $8.15.
CPP/Sterling Partners have the right to match any higher offer or take a $10 million break-fee.
Toronto-based Livingston through its operating subsidiaries, is Canada’s largest customs broker and the number three entry filer in the United States as well as an important North American provider of transportation and integrated logistics services. The company employs over 2,500 through more than 125 offices in Canada and the United States. They have about 30,000 clients.
The Globe’s Andrew Willis says “The planned Livingston purchase is likely the start of a consolidation play, with the new owners backing acquisitions by the Livingston management team.” (Sources: Livingston web site and press releases; Globe and Mail, 2009-10-08, “Private equity buys Livingston International” - 2009-10-14, “Higher Livingston bid likely: BMO”)
