PetSmart Up; Another Big Holder Tells Board To Mull Sale

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PetSmart Inc.
PETM
shares rose 2 percent Monday after a long-time 9 percent shareholder jumped on the bandwagon advocating a sale of the company. Longview Asset Management added its voice to that of activist investor Barry Rosenstein, who on July 3 called on the board to undertake a "strategic review" including possible sale. "Now that prominent brokerage firms have suggested PetSmart is 'in play,' we believe the board should consider this path," Longview Chief Executive James A. Star said in a letter to PetSmart filed Monday with the Securities and Exchange Commission. Star said that prior to his letter, Longview had not advocated such a review. PetSmart is likely to be valued more highly by private market than the current public market, Star said, noting that current interest rates may help support a higher potential buyout price. "We're also concerned that a prolonged activist campaign will distract employees," Star added. On July 3 PetSmart shares rose more than 15 percent when Rosenstein disclosed the acquistion of 9.8 million shares and that he would encourage the board to engage in a strategic review. PetSmart traded recently at $68.63, up 2 percent.
Posted In: NewsM&A
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