Shares in Canada’s largest grain handler took a short break from TSX trading Friday afternoon after Viterra confirmed “expressions of interest” from third-party investors.
The Calgary-based company, formed in 2007 by the merger of Regina’s Saskatchewan Wheat Pool and Winnipeg’s Agricore United, said Friday it acknowledged the interest “in view of market activity in Viterra’s shares.”
Viterra shares (VT: TSX), which opened trade Friday morning at $11, jumped over 28 per cent to a high of $14.10, and sat at $13.58 as of 4 p.m. ET after trading resumed.
The company had just booked lower profits Thursday for its first fiscal quarter ending Jan. 31, at $77.69 million on $3.56 billion in gross revenue, down from $100.68 million on $2.33 billion in the year-earlier period.
In its financial Q1 statement, the company reiterated that it expects a substantial boost in its earnings before interest, taxes, depreciation and amortization (EBITDA) to the tune of an extra $40 million to $50 million per year by in fiscal 2014 and beyond.
The added revenue is expected to follow from the formal deregulation of the Canadian Wheat Board’s single marketing desk for Prairie wheat, barley and durum, set for Aug. 1.
“In this new environment, Viterra expects to increase its earnings by leveraging its global grain marketing network in key export growing regions, attracting additional volumes and optimizing its operational efficiencies,” the company said Thursday.
However, the end of the CWB’s single desk has also been widely expected to draw more international grain players into the Prairie grain industry, many of whom could be considered potential suitors for Viterra and none of whom were commenting in media reports Friday.
Viterra last month also signed a deal to sell all its North American livestock feed processing assets to a managers’ group and Toronto investment firm for an undisclosed sum.
Viterra goes off livestock feed, Feb. 15, 2012