Foodtastic Offers C$43 a Share to Acquire MTY at a 32% Premium
Key Facts
Foodtastic announced on November 3, 2026, a cash proposal to acquire all outstanding shares of MTY Food Group for C$43 a share, which it said represented a 32% premium to the October 30 closing price and a 37% premium to the volume-weighted average price over the 30 days ended on that date. The company published the proposal after MTY’s board rejected it, putting a specific price before investors while the board’s position remains an obstacle to any negotiations. Reuters reported that the board rejected the offer on October 30, saying that engaging in discussions was not in the company’s best interests. Foodtastic first submitted its offer in writing on October 15 and reaffirmed it on October 20. It said the transaction would be carried out under a statutory plan of arrangement pursuant to Canadian corporate law.
The premiums announced by Foodtastic are measured against MTY’s October 30 closing price and its volume-weighted average price over the 30 days through the same date. The published information does not provide a separate figure for either the closing price or that average, while Reuters’ report gives the two percentages announced by the company. Foodtastic also cited the shares’ performance through October 30, saying they were down 12% year to date, 32% over three years and 40% over five years. Reuters reported that the one-year average price target from analysts at five Canadian banks, discounted to present value, did not indicate upside from the then-current price of about C$32 a share. The announced offer price therefore exceeds the current price cited in the report, as well as the price target calculated by Foodtastic.
Foodtastic said the transaction would be financed by the company and its institutional partners, with a full financing commitment conditional on completion of due diligence. This means the announced financing has not yet reached a full commitment, under the condition cited by the company. It also described the transaction structure as a statutory plan of arrangement under Canadian corporate law. MTY’s board rejected engagement with the proposal on October 30, according to Reuters, after first receiving the offer on October 15 and seeing it reaffirmed on October 20. The published information does not indicate that MTY has agreed to proceed with a transaction or begin negotiations.
MTY’s third-quarter results provide a picture of its performance before the proposal was announced: revenue was C$277.7 million in the fiscal third quarter, down 7.1% from the same period in 2025. The company attributed the decline mainly to lower revenue from company-owned stores and delayed promotional activity in the retail segment. The fiscal quarter covered 13 weeks and ended on August 30, 2026, and MTY reported its results on October 9. Same-store sales fell 1.9% year over year during the quarter, including declines of 0.2% in Canada, 2.7% in the United States and 9.1% in international markets. Chief Executive Eric Lefebvre said the franchise segment showed “remarkable resilience” despite continued pressure on consumer spending and a difficult operating environment.
MTY’s network totaled 6,966 locations at the end of the third quarter, including 6,782 operating under franchise or operating agreements and 184 company-owned locations. During the quarter, the group opened 72 locations and closed 146, reducing the network by a net 74 locations. It said 50 of the closures were related to a company-owned store closure plan announced in the second quarter. Foodtastic, by comparison, operates a portfolio of 30 restaurant brands and about 1,200 locations in Canada, Reuters reported. These figures show the difference in scale and operating models between the two networks, as most MTY locations rely on franchises or operating agreements.
MTY completed its strategic review on October 9, announcing that its board and a special committee of independent directors had unanimously chosen to accelerate its existing plan, with a greater focus on efficiency, simplification and capital allocation discipline. The plan included resuming its regular share buyback program and evaluating a substantial buyback offer, alongside returning capital to shareholders. The company raised its quarterly dividend to C$0.50 a share from C$0.37, payable on November 13 to shareholders of record on November 3. MTY’s announced plan thus combined operational changes with capital return measures, while Foodtastic’s offer remained rejected by the board, according to the latest position in the published information. That information does not include a published response from MTY to Foodtastic’s November 3 announcement.