In a vindication of the Rona board's business judgment, on
February 3, 2016, Lowe's agreed to acquire Rona for $24 per
share in cash – a 65% premium to Lowe's July 2012
unsolicited $14.50 proposal that was rejected by Rona's board,
and a 104% premium to the pre-announcement share price.
Lowe's original proposal did not proceed in part due to the
Québec government's concerns about the effect of the
transaction on Rona's stakeholders and the Québec
economy more generally.
While board entrenchment and excessive governmental
protectionism are to be avoided, there are many instances in which
the board's long-term business judgment in respect of value and
other stakeholder interests, as well as the government's
legitimate concern about the economic impact of a transaction, turn
out to be warranted. In this case, shareholders are receiving a
much higher premium than they would have under the original
proposal. Lowe's has also made a number of important
commitments,
