RBC Capital Raises Ipsco Inc. Price Target On Word of Buyout Talks

RBC Capital analyst Marie Millien weighed in on Ipsco Inc's (IPS) announcement that it was in buyout talks with Evraz Group SA, by saying the price to acquire North America's last standing independent tubular company should range from $152 to $171 per share.

As a result, she raised her price target from US$138 to US$170 and left her 'outperform' rating unchanged.

Ipsco is a valuable asset and combined with Evraz's recently purchased Oregon Steel, may offer valuable synergies, she said in a note to clients.

Any anti-trust concerns due to Ipsco's and Oregon's large positions in the market, should be minor she added, given that imports represent about half of the 1.5 million ton per year market and significant new projects and expansions have been announced.

Over the past week, Ipsco shares have shot up more than US$20 to just under US$150 as of mid-afternoon trading Friday.

IPS 1-yr chart: