Stifel GMP on Friday maintained its buy rating on the shares of Andlauer Healthcare Group (AND.TO) while raising its price target to C$59.00 from C$53.00 as it sees the possibility of alternative bids arising for the healthcare-logistics company after it agreed to be acquired by UPS for C$55.00 per share.

"UPS is to acquire Andlauer for $C55.00/share in a C$2.2b transaction, 31% premium and ~14x LTM EBITDA multiple. Andlauer is an end-to-end cold-chain healthcare logistics provider with 85% sales-Canada, 15%-U.S. and +30% market share. We see the offer as favorable and believe the deal will pass anti-trust hurdles (below), albeit some risk is embedded, as evident by a C$110mm (~C$2.80/share) reverse termination fee, payable by UPS. While we have no knowledge of any M&A negotiations or discussion, we also see the potential for a superior bid to emerge with FedEx, Kuehne & Nagel, McKesson, TFII and Lineage (LINE) as other potential suitors. Andlauer has moat aspects and strategic asset, including the most Health Canada licenses in storing and distributing high valued narcotics and sensitive products. Combined with a nonexclusive process, relatively low break-fee ($66mm) and moderate premium, we see good downside-upside for a superior bid and maintain a BUY rating. Our new $59.00 target reflects a speculative superior bid scenario," analyst Justin Keywood wrote.

(MT Newswires covers equity, commodity and economic research from major banks and research firms in North America, Asia and Europe. Research providers may contact us here: https://www.mtnewswires.com/contact-us)

Price: 53.41, Change: +0.09, Percent Change: +0.17