MONTREAL - TransForce Inc. (TSX:TFI) has a friendly offer to acquire Contrans Group Inc. (TSX:CSS) for $495 million in cash.
The board of Contrans, a trucking company based in Woodstock, Ont., is unanimously supporting TransForce's offer of $14.60 per share â€” on the condition that at least two-thirds of the outstanding class A and B shares are tendered.
In addition to the money from Montreal-based TransForce, Contrans would pay a special dividend of 40 cents per share, bringing the total amount that its shareholders could receive to $15 per share.
The funds for the special dividend would come from the recent sale of the Contrans waste transportation segment.
TransForce announced the offer Thursday, after it issued second-quarter results.
TransForce reported it had $37.3 milion of net income in the three months ended June 30, or $62.8 million after excluding a non-cash asset impairment charge related to its previously announced exit from its Canadian drilling rig moving business.
TransForce's revenue for the second quarter was $889.1 million including fuel surcharges, up from $792.3 million a year earlier. The negative impact from TransForce's phased withdrawal from the rig moving business was more than offset by $102.3 million in addition revenue from the acquisitions of Vitran, Clarke Transport and Clarke Road Transport.
In the second quarter of 2013, TransForce had $26.6 milion or 28 cents per share of net income.
The company has scheduled a conference call at 9 a.m. Friday to discuss the quarterly results and the Contrans deal.
TransForce operates across Canada and in the United States through a network of operating subsidiaries, including the Canpar parcel delivery service, trucking companies and specialized services including waste management.
Contrans is a freight company, with about 1,400 power units and 2,600 trailers under management â€” making it one of the Canadian trucking industry's largest players.