WRK - Domtar unlikely to see higher offer than Paper Excellence analyst says

Domtar (UFS) is unlikely to see a higher bid than the mid $50s/share that Paper Excellence is reported to have bid, according to KeyBanc. Domtar gained 18.5% in premarket trading.The reported price would valued Domtar at ~6x consensus 2021 EBITDA estimate, while Domtar has historically traded at  ~5X EBITDA, KeyBanc analyst Adam Josephson wrote in a note. Also any potential bid would come at a time of "near-record" pulp price in China, though pulp prices are "exceedingly volatile."The analyst notes that Paper Excellence has been on a pulp "buying spree" over the past decade.KeyBanc didn't see Paper Excellence bid coming as for much of the past year there has been speculation about a takeover of Domtar, though Packaging Corp. of American (PKG) was mainly mentioned as a possible buyer."Paper Excellence has encountered problems with some assets it has acquired in North America in recent years, but the company appears undeterred, at least

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Domtar unlikely to see higher offer than Paper Excellence, analyst says