Description: Alimentation Couche-Tard Inc., a large chain of convenience stores centered in Québec, has repurchased a large block of shares from one of its founders. The deal will pay Alain Bouchard approximately $300 million for over 6 million shares. A company director who chaired the special board committee that approved the deal said that the repurchase “will create value for all shareholders.”
Date: October 8, 2021
1) Is there a Couche-Tard near your university campus? Is it a popular spot for students?
2) Notice the board member’s statement that this transaction”will create value for shareholders?” What do you think that statement means?
3) Page 11-8, Exhibit 11.3, of Wiley’s Understanding Financial Accounting shows two different scenarios for recording the repurchase of shares: one when the shares are bought back at less than the original issue price and another for the opposite situation. Do a little research with your classmates to see which scenario might prevail in the Couche-Tard transaction.