The Reject Shop Limited (ASX:TRS) to Be Acquired by Dollarama Inc. at 112% Premium
Acquisition Details
The Reject Shop Limited (ASX: TRS) has entered into a binding Scheme Implementation Agreement with Dollarama Inc. (TSX: DOL), whereby Dollarama will acquire all issued and outstanding shares of The Reject Shop at a price of A$6.68 per share, representing a 112% premium to the closing share price on 26 March 2025.
Board and Shareholder Support
The Reject Shop’s Board unanimously recommends that shareholders vote in favour of the Scheme. The company’s largest shareholder, Kin Group Pty Ltd, which holds 20.8% of the shares, has confirmed its intention to vote all its shares in favour of the acquisition.
Special Dividend
If the Scheme becomes effective, The Reject Shop Board intends to determine a fully franked special dividend of up to A$0.77 per share, payable prior to the implementation of the Scheme. The Dividend amount will be deducted from the Scheme Consideration.
Executive Comments
Chairman Steven Fisher stated, “Today marks a milestone in the journey of The Reject Shop. Attracting an offer from Dollarama, a recognised leader in the value retail market, is testament to both the meaningful improvement that our incredible team has made to our business over the past few years as well as the significant growth potential that exists for The Reject Shop. The all-cash Scheme Consideration provides attractive value and certainty for all shareholders. The Board believes the proposed transaction will benefit both shareholders and stakeholders of The Reject Shop and is in line with the Board’s priority to deliver shareholder value.”
CEO Clinton Cahn commented, “We are excited about the opportunities that this transaction presents. There is strong cultural alignment between our teams and we look forward to working alongside the Dollarama team to leverage the expertise of a leading value retailer, accelerate our store network expansion plan and continue helping all Australians save money every day.”
Dollarama CEO Neil Rossy added, “Identifying the right opportunity to expand into new geographies and build on our track record as a leading value retailer in Canada and Latin America has been a key objective for the Dollarama team. With this acquisition, we have a unique and compelling opportunity to bring our differentiated value proposition to a new market which presents a clear path for growth through an established platform. We look forward to embarking on this new chapter of Dollarama’s international growth journey with the local management team and its more than 5,000 employees across Australia. Together, we will leverage our core strengths as value retailers with best-in-class merchandising, sourcing and operational expertise. With compatible cultures and values, we are confident that the business will have an exciting future as Dollarama’s new and complementary growth platform.”
Motley Fool contributor Lianne Eastty has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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