Metro signals it intends to launch share buy back | iNFOnews

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Metro signals it intends to launch share buy back

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January 29, 2013 - 8:01 AM

MONTREAL - Metro Inc. is signalling on its website that it intends to launch a share buy back program.

The grocer (TSX:MRU) has posted a headline in the news section of its website, dated today, that reads "Metro Inc. announces plan to buy back shares through private placements."

But the headline does not yet link to a longer release with details.

Metro will post first quarter results today and hold its annual general meeting.

It is expected to be asked about how it will use an estimated $380 million in net proceeds from the sale of nearly half its stake in convenience store operator Alimentation Couche-Tard.

Industry observers have speculated that Metro is either eyeing an acquisition or looking to reward its shareholders.

The Montreal-based company sold 48.2 per cent of its 25-year investment in Couche-Tard to three Canadian banks for $479 million.

On Monday, Metro increased its quarterly dividend to 25 cents from 21.5 cents, payable on March 15 to shareholders of record as of Feb. 19.

Adjusted earnings for the quarter are expected to increase by nearly 14 per cent to $1.15 per share on $2.76 billion of revenues in the first quarter of its fiscal year, according to analysts polled by Thomson Reuters.

That compared to $1.01 per share on $2.71 billion of revenues a year earlier.

If Metro goes the acquisition route likely targets are in Canada's grocery or pharmacy sector, including B.C. supermarket chain Overwaitea, Safeway Canada, Rexall pharmacy or Quebec's Uniprix pharmacy.

Metro is Quebec's leading grocery chain with nearly 34 per cent market share. It has more than 65,000 employees in Quebec and Ontario.

The company's 65,000 employees work at a network of more than 600 food stores under several banners including Metro, Metro Plus, GP, Super C and Food Basics, as well as over 250 drugstores under the Brunet, Brunet Plus, Clini Plus, The Pharmacy and Drug Basics banners.

News from © The Canadian Press, 2013
The Canadian Press

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