Renewed speculation that BJ’s Wholesale Club Inc., which has 12 Connecticut stores, is an acquisition target sent the Massachusetts warehouse club operator’s stock up more than 6 percent in late morning trading on Wednesday, The Associated Press reports.
The company, based in Natick, Mass., has been rumored to be a possible buyout target since July, when Leonard Green & Partners LP purchased a 9.5 percent stake.
Last week, the Los Angeles private equity firm announced that it would buy fabric and craft store chain Jo-Ann Stores Inc. for about $1.6 billion. It is also involved in the $3 billion deal for J. Crew Group Inc.
A report in the New York Post on Wednesday said Leonard Green & Partners still wants to buy BJ’s and may make a hostile bid for the company if a sales auction isn’t initiated in the coming weeks.
BJ’s stock jumped $2.97, or 6.7 percent, to $47.44 in late morning trading. Over the past year, the shares have traded between $32.36 and $48.43.
David Strasser of Janney Capital Markets supports a buyout, saying in a client note that “a deal makes sense due to the potential for a national store roll-out.”
Strasser dismisses concerns that Leonard Green & Partners may be done making deals, explaining that the firm has “ample liquidity left from its 2007 fund.”
