Rona to focus on strengthening chain after Lowe’s abandons takeover bid

U.S.-based Lowe’s may not have ended its cross-border courtship for Rona Inc. despite abandoning its $1.8-billion bid for the Canadian home improvement chain, industry experts believe.

MONTREAL — U.S.-based Lowe’s may not have ended its cross-border courtship for Rona Inc. despite abandoning its $1.8-billion bid for the Canadian home improvement chain, industry experts believe.

Quebec-based Rona said Monday it only learned through a news release that its U.S. suitor had withdrawn its unsolicited, non-binding acquisition proposal, adding that it continues to concentrate on its own efforts to rejuvenate the company.

“Our focus is on the implementation of our business plan based on the renewal of our offer to consumers. This focus remains,” spokeswoman Valerie Lamarre said in an email.

In addition to improving the shopping experience, Rona wants to improve its financial results after months of weakness.

The U.S. chain’s withdrawal Monday will come at a cost to Rona investors, with Rona’s shares dropping more than 11 per cent following the announcement that Lowe’s is no longer contemplating an offer of $14.50 per share cash.

Rona stock closed down $1.48 to $11.29 in Wednesday trading on the Toronto Stock Exchange. Lowe’s Companies Inc. shares (NYSE:LOW) slipped 17 cents to US$29.23 in New York.

Meanwhile, analysts say Lowe’s may still have designs for Rona, if not by acquisition of the whole chain, then perhaps by adding big box stores as Rona expands the number of smaller, proximity stores.

The U.S. chain’s withdrawal comes seven weeks after Rona, the Quebec government and others objected to the U.S. company’s overtures, which had begun privately in late 2011 and became public in July.

“Lowe’s continues to believe that a combination of Lowe’s and Rona makes business sense and would create significant value for all stakeholders,” Lowe’s said in a statement Monday.

“It is unfortunate that the Rona board of directors did not recognize the important economic and commercial benefits of this proposal for its stakeholders and for Canada,” the statement said.

The potential sale of Rona surfaced in the midst of a provincial election and prompted rare agreement between the Liberal government and the Parti Quebecois about the strategic importance of the company and the need to preserve the headquarters in Quebec.

The political parties had even suggested changing provincial law to arm boards of directors with more power to veto foreign takeovers, a proposal with potential domino-effect implications for other parts of the country.

Just Posted

New admissions have been suspended for Engineering Technology diplomas (Instrumentation, Electrical and Mechanical) and the Transitional Vocational Program at Red Deer College. (Photo by Sean McIntosh/Advocate staff)
Developmentally disabled impacted: Red Deer College suspends program

Transitional Vocational Program comes to an end

Alberta’s chief medical officer of health Dr. Deena Hinshaw is asking Albertans to do their part by observing gathering limits, staying home if unwell, wearing masks and maintaining physical distance. (Photo by Chris Schwarz/Government of Alberta)
Three new Central zone COVID-19 deaths, Alberta adds 1,433 cases

Red Deer down to 802 active cases of COVID-19

NDP education critic Sarah Hoffman holds up freedom of information requests that turned up no records. The Opposition requested back-to-school re-entry plan correspondence between Education Minister Adriana LaGrange and school boards, teachers and the media. Photo via Facebook live
NDP renews calls for Alberta gov’t to scrap K-6 draft curriculum

The NDP is once again calling on the Alberta Government to get… Continue reading

Earlier this week Alberta Health Services warned that Rocky Mountain House Health Centre emergency department would be temporarily without physician coverage from May 12, at 6 p.m., to May 13, at 7 a.m. (Photo contributed by the Town of Rocky Mountain House)
Doctors needed in Rocky Mountain House

Emergency department temporarily closed due to doctor shortage

The owner of Mae’s Kitchen in Mirror, says hamlet residents were ‘disheartened’ by a recent anti-restriction protest. The restaurant is following all the health restrictions in place. (Photo courtesy Mae’s Kitchen Facebook)
‘We don’t need that’: Mirror restaurant against recent anti-restriction protest

A week after a large anti-restriction protest at The Whistle Stop Cafe… Continue reading

Bo’s Bar and Grill owner Brennen Wowk said the hospitality industry is looking for more clarity from the province around what conditions must be met to allow for restaurants reopening. (Advocate file photo)
Frustated restaurant owners want to know government’s reopening plan

Restaurant owners feel they are in lockdown limbo

Alberta's provincial flag flies on a flag pole in Ottawa, Monday, July 6, 2020. A judge is expected to rule this morning on a challenge of the United Conservative government's inquiry into whether foreign groups have conspired against Alberta's oil industry. THE CANADIAN PRESS/Adrian Wyld
Judge dismisses attempt to quash ‘anti-Alberta’ activities inquiry

Judge dismisses attempt to quash ‘anti-Alberta’ activities inquiry

Albertans receive vaccines at a mass COVID-19 vaccination clinic in Calgary on Thursday, April 22, 2021. Alberta Health Services says it has obtained a restraining order against a Calgary mayoral candidate who the agency says has threatened health workers. THE CANADIAN PRESS/Jeff McIntosh
Alberta health agency obtains restraining order against Calgary mayoral candidate

Alberta health agency obtains restraining order against Calgary mayoral candidate

In this file photo dated Friday, Feb. 12, 2021, doses of AstraZeneca vaccines for COVID-19 sit in vials at the Fiocruz Foundation after being bottled in Rio de Janeiro, Brazil. Some health experts are questioning Canada's decision to accept thousands of doses of the Oxford-AstraZeneca vaccine this week just for them to sit in freezers in an Ontario warehouse because provinces have shunned the idea of using any more of them for first doses. THE CANADIAN PRESS/AP/Bruna Prado, FILE
Experts call on Canada to use COVAX doses of AstraZeneca or give them back

Experts call on Canada to use COVAX doses of AstraZeneca or give them back

Chief Public Health Officer Theresa Tam listens to a question during a news conference, in Ottawa, Tuesday, Jan. 12, 2021. Federal health officials are laying out their vision for what life could look like after most Canadians are vaccinated against COVID-19. THE CANADIAN PRESS/Adrian Wyld
Federal officials lay out road map for post-vaccine life as third wave ebbs

Federal officials lay out road map for post-vaccine life as third wave ebbs

An aerial view of housing in Calgary is shown on June 22, 2013. The Calgary Real Estate Board says the city's housing market is expected to stabilize, with some prices forecast to rise this year. THE CANADIAN PRESS/Jonathan Hayward
Alberta health agency obtains restraining order against Calgary mayoral candidate

CALGARY — Alberta Health Services says it has obtained a restraining order… Continue reading

Canadian Heritage Minister Steven Guilbeault is seen during a news conference Thursday, June 18, 2020 in Ottawa. THE CANADIAN PRESS/Adrian Wyld
Guilbeault doubles down on Bill C-10 as opposition MPs demand Lametti testify

Guilbeault doubles down on Bill C-10 as opposition MPs demand Lametti testify

In this image from video, Rep. Brian Higgins, D-N.Y., speaks on the floor of the House of Representatives at the U.S. Capitol in Washington, Thursday, April 23, 2020. A U.S. lawmaker who has made a political crusade out of getting the border with Canada reopened is once again pressing his case with President Joe Biden. THE CANADIAN PRESS/AP-House Television via AP
New CDC guidance makes it clear: time to reopen Canada-U.S. border, congressman says

New CDC guidance makes it clear: time to reopen Canada-U.S. border, congressman says

Cows and their calves graze in a pasture on a farm near Cremona, Alta., Wednesday, June 26, 2019. Thanks to a decade of rapid growth, there are now 279 facilities across Canada creating biogas from methane emitted by agricultural waste, landfills, green bin programs and municipal wastewater treatment facilities. THE CANADIAN PRESS/Jeff McIntosh
Methane-capturing biogas projects in Canada reach 279, says association report

Methane-capturing biogas projects in Canada reach 279, says association report

Most Read