Reitmans shares soar after Fairfax ups stake in retailer to 13.8%

TORONTO, Cananda – Shares in Reitmans (Canada) Ltd. (TSX:RET.A) shot up more than nine per cent Monday in the first trading day after Fairfax Financial Holdings Ltd. (TSX:FFH) announced it had increased its stake in the retailer.

Fairfax said late Friday that it had acquired two million class A non-voting shares in the company at $6.35 per share. That raised its stake by 3.9 per cent to 13.8 per cent from just under 10 per cent.

Fairfax did not give a reason for acquiring shares in the company, whose stock has fallen steadily since hitting almost $20 in 2010, saying only that it “continually reviews its investment alternatives and may purchase additional shares of Reitmans from time to time in accordance with applicable laws.”

On the Toronto Stock Exchange, Reitmans shares closed up 57 cents, or 8.98 per cent, at $6.92.

Reitmans is a retailer of mainly women’s apparel operating under such banners as Reitmans, Smart Set, RW&CO., Penningtons, Addition-Elle and Thyme Maternity.