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Why Checkpoint Systems, Inc. Stock Skyrocketed 34.8% in March

By Steve Symington - Apr 5, 2016 at 8:45PM

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The merchandise availability solutions company is being acquired.

Image source: Checkpoint Systems.

What: Shares of Checkpoint Systems (CKP.DL) climbed 34.8% in March, according to data provided by S&P Global Market Intelligence, primarily after the company announced it has agreed to be acquired by an affiliate of specialty label and packaging solutions specialist CCL Industries. 

So what: More specifically, CCL will acquire Checkpoint Systems for $10.15 per share in cash, which values the company at roughly $443 million. When the acquisition was announced on March 2, that price represented a 29% premium to Checkpoint's closing price the previous day, and a 50% premium over its 30-day volume-weighted average price. 

Now what: The acquisition remains subject to customary closing conditions, including approval by Checkpoint's shareholders. But assuming all conditions are met or waived, Checkpoint anticipates the transaction to close in the second quarter of 2016. With shares of Checkpoint stock now trading at exactly the agreed acquisition price -- and unless holding on a little longer will ensure you lock in lower long-term capital-gains tax rates -- I suggest Checkpoint shareholders take their profits now and put them to work elsewhere.

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