The American hardware chain Lowe's is making a second attempt to buy Quebec-based Rona Inc.

This time around the Americans are offering $3.2 billion in a deal that is supported by management of both companies.

In 2012 Lowe's attempted to buy Rona but the offer failed in the face of widespread opposition from Rona's independent dealers, its board of directors, and from the Quebec government.

At the time, the Caisse de Depot bought an additional stake in Rona, increasing its amount of shares to 14 percent.

On Wednesday, the Caisse de Depot said it had reviewed the offer and would sell its shares. 

It pointed out that Lowe's is offering a premium price for the shares, and that the company is making commitments to Quebec and Canada, and it believes the deal would "result in equal or superior economic activity generated by the Rona banners in Quebec."

Economic Development Minister Dominique Anglade said she did not expect the government would interfere with the sale, because the offer announced Wednesday was very different from what was going on in 2012.

"That was a hostile takeover. The Quebec owners did not want to sell at that time and the context now is very different," she said in a televised interview.

"In this case we think that for the majority of Quebecers it will be a benefit."

Anglade did point out that she wants the name Rona to remain, and that she is glad that Lowe's will maintain a head office for Canadian operations in Boucherville. 

"These are elements that are going to be critical for us," said Anglade.

Anglade also said that any questions about the Caisse de Depot's involvement in Rona should be directed to the Caisse's CEO.

"It's a discussion that you should have with Michael Sabia. It's an entity that's separate from the Quebec government," said Anglade.  

 

 

On Wednesday morning Parti Quebecois leader Pierre Karl Peladeau tweeted that Quebec-based companies should not be sold to foreigners.

 

He added that no matter the promises made, it's inevitable that head offices will be moved elsewhere, and that the Caisse de Depot should stop the buyout.

"We've been losing head offices one after the other. Bell Astrale, Rio Tinto Alcan and Provigo. At the end of the day what's going on? Basically we are losing our capacity to take decisions and control our economy," said Peladeau.

 

Lowe's Canada President Sylvain Prud'homme  acknowledged at a press conference on Wednesday that nothing is certain for Rona's employees.

"We have very strong plans to make sure we achieve growth, so by default there should be no issue for any employee in the organization right now," he said. "The reality is, until we've gone through shareholder approval and actually gone through regulatory approval, we have not done detailed integration planning."

Current Rona Chain Robert Chevrier said he is in favour of selling the firm to Lowe's.

"The team at Lowe's has presented us with an excellent plan that enables our company to maintain its brand power while at the same time leveraging Lowe's global presence to build upon and expand our reach," he wrote in a statement.

At a press conference on Wednesday, he reiterated his support for the deal, saying "Let's put it this way: this is a very, very attractive price."

Lowe's is offering $24 per share of Rona -- about double its current trading value.

The chair, president and CEO of Lowe's, Robert Niblock, said his offer is outstanding.

"The strategic rationale of this transaction, for both companies, is very compelling," said Niblock.

Rona is currently the market leader in Quebec, a location where Lowe's has no presence. Lowe's is active in Ontario and other provinces but it trails both Rona and Home Depot in the number of locations.

In the United States, Lowe's is ranked second in number of locations, while Home Depot is the market leader.

Rona has nearly 500 stores across Canada and directly employs 17,000 people, while its dealers employ 5,000 more people.

Its head office is in Boucherville, and it has nine distribution centres across the country.

Lowe's has promised to maintain the Boucherville head office for Canadian operations, to keep the existing store names, and to keep the vast majority of current employees.