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Category Archives: Public M&A

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Early Warning Reporting Threshold Remains at 10% While Other Changes to Enhance Transparency Will Be Implemented

Posted in Public M&A, Shareholders, Strategy

On October 10, 2014, the Canadian Securities Administrators (CSA) provided an update on the status of proposed amendments to Canada’s early warning reporting (EWR) system first published in March 2013.[1]  After extensive public consultation, the CSA announced that they will proceed with the amendments except for two important proposals: to reduce the reporting threshold from… → Read More

CETA Will Create a Two-Tiered System for Investment Canada Act Reviews

Posted in Private Transactions, Public M&A, Strategy

The text of the Canada and European Union (EU) Comprehensive Economic and Trade Agreement (CETA) is due to be released soon, but it remains to be seen if the Canadian government will clarify which countries, in addition to those in the EU, will benefit from the higher $1.5-billion threshold for review under the Investment Canada… → Read More

Proposed Changes to Takeover Bid Regime in Canada Would Put More Time in the Hands of Target Boards

Posted in Public M&A, Shareholders, Strategy

On September 11, 2014, the Canadian Securities Administrators (CSA) published CSA Notice 62-306 – Update on Proposed National Instrument 62-105 Security Holder Rights Plans (Notice) and the Autorité des marchés financiers (AMF) Consultation Paper An Alternative Approach to Securities Regulators’ Intervention in Defensive Tactics. The notice indicates that the CSA intend to publish for comment a… → Read More

More on “Golden Leash” Arrangements

Institutional investor organization urges SEC to require disclosure

Posted in Public M&A, Shareholders, Strategy

The debate about so-called “golden leash” arrangements has picked up again. The Council of Institutional Investors (“CII”), an influential association of institutional investors, recently wrote a letter to the U.S. Securities and Exchange Commission (“SEC”) expressing its concerns regarding the transparency of compensation paid in “golden leash” arrangements. As discussed in our previous post, “golden… → Read More

Augusta/HudBay – A model for target boards to say “not now”?

Posted in Public M&A, Shareholders, Strategy

The recent outcome of the Augusta/HudBay poison pill hearing provides some insight into how a shareholder rights plan may withstand scrutiny from a Canadian securities regulator for an extended period of time in the right circumstances. Though perhaps the result of somewhat unique facts, including insufficient initial support for the price being offered by the… → Read More

Don’t “put” yourself at risk

Beware of the use of put and call options

Posted in Public M&A

Canadian securities legislation provides that a take-over bid may be triggered when an offer to acquire outstanding voting or equity securities of a class of a public company is made to a person in a Canadian jurisdiction, where the securities subject to the offer, together with the offeror’s own securities, constitute in the aggregate 20%… → Read More

New 2014 Competition Act Merger Notification Threshold

Posted in Private Equity, Private Transactions, Public M&A

The pre-merger notification transaction-size threshold for 2014 has increased to $82 million from the 2013 threshold of $80 million. As per the indexing mechanism set out in the Competition Act (Act), the pre-merger notification threshold is reviewed annually. The threshold is based on the book value of assets in Canada of the target (or in… → Read More

By-laws counteracting “Golden Leash” arrangements: ISS speaks

Posted in Public M&A, Shareholders, Strategy

On January 13, 2014, Institutional Shareholder Services Inc. (“ISS”) issued FAQs explaining its views on by-laws designed to prohibit so-called “Golden Leash” arrangements. As discussed in our post last month, such arrangements arise when a shareholder activist privately offers to compensate its nominee directors in connection with such nominees’ service as a director of the… → Read More

New 2014 Investment Canada Act WTO Review Threshold

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

Industry Canada has announced that the Investment Canada Act (Act) threshold for 2014 that applies to most direct acquisitions of Canadian businesses by non-Canadian investors from World Trade Organization (WTO) member countries is $354 million (an increase from last year’s $344 million threshold). The threshold applies to the gross book value of the target’s assets…. → Read More

A Guide to Canadian M&A in the Second Half of 2013

Posted in Awards and Recognitions, Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

In July, we published a blog post on the Canadian M&A landscape in the first half of 2013.  As 2013 has now come to an end, it seems appropriate to recap what happened in the second half of 2013.  McCarthy Tétrault advised on seven of Lexpert’s top ten deals of 2013, published in the January… → Read More

“Golden Leashes”

The Controversy from this Proxy Season

Posted in Public M&A, Shareholders, Strategy

“Golden Leashes”, and by-laws designed to counteract such arrangements, have provoked significant controversy in the 2013 proxy season, and regulators, proxy advisors, and institutional shareholders have yet to take a definitive position in the debate. This post reviews what will certainly continue to be a hot button topic in 2014.

TSX Proposes to Loosen Shareholder Approval Requirements for New Security-Based Compensation Arrangements in M&A Transactions

Posted in Public M&A, Shareholders, Strategy

On November 28, 2013, the Toronto Stock Exchange published proposed amendments to the TSX Company Manual that would permit a listed issuer to adopt new security-based compensation arrangements for employees of a target company in the context of an M&A transaction without the need to obtain shareholder approval provided that certain conditions are met. The… → Read More

DON’T ASK, DON’T TELL?

Lessons from the SEC’s recent “ring fencing” settlement with Revlon

Posted in Private Equity, Private Transactions, Public M&A, Shareholders

The recent settlement in the United States between the Securities and Exchange Commission (SEC) and Revlon highlights the importance of not appearing to obstruct the flow of material information to shareholders. The SEC settled charges that Revlon misled shareholders during a going private transaction. The SEC’s order found that to avoid a potential disclosure obligation,… → Read More

Dealmaking in the Beauty and Personal Care Space

Highlights from the Recent Mergermarket Report, Buying Into Beauty

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A

Check out our new post published on our Retail Consumer and Advisor Blog on Buying Into Beauty, the recent Mergermarket report prepared in association with Michel Dyens & Co. In addition to highlighting some of what we think are the key themes coming out of that report for the retail and consumer products audience in… → Read More

Should a Seller Care About Due Diligence?

Yes. And here are a few MORE reasons why.

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Strategy

In our recent post we considered, to what extent, the seller in the context of an M&A transaction should care about legal due diligence, and suggested that there are a number of important reasons why a seller should concern itself with legal due diligence in the face of an acquisition. In addition to our thoughts… → Read More

Should a Seller Care About Due Diligence?

Yes. And here’s a few reasons why.

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Strategy

Legal due diligence is typically a key part of an acquisition, but historically the focus has been on diligence from the perspective of the buyer, and less frequently from the perspective of the seller. Of course, this is natural given it’s the buyer who will want to uncover everything it can about the business it… → Read More

Let me bridge the Gap

Contingent Value Rights as a tool in structuring M&A transactions

Posted in Public M&A

In M&A transactions, the determination of the value of a target company may sometimes give rise to a debate.  For example, typical valuation methods may have their limits when it comes to the potential of undeveloped or early-stage assets.  The difficulty in predicting the outcome of contingent events (e.g. major litigation involving the target), may… → Read More

Insider Trading in the Context of M&A Activity Part 2

Key Takeaways from the Lambert Settlement

Posted in Public M&A

A few days ago we told you about the recent settlement agreement between Anthony Lambert and the Alberta Securities Commission. If you missed that post, you can check it out here for background or read on for our key takeaways on insider trading in the M&A context from the Lambert settlement and other recent decisions… → Read More

Insider Trading in the Context of M&A Activity Part 1

The Lambert Settlement, a Cautionary Tale

Posted in Public M&A

A recent settlement agreement between Anthony Lambert (“Lambert”) and the Alberta Securities Commission (“ASC”) presents a cautionary tale for directors and officers of public companies who are considering trading in securities during the early stages of M&A activity. We’ll discuss some of the key takeaways from this cautionary tale in our next post, but for… → Read More

Are you meeting expectations? A Case for Benchmarking

A Canadian perspective on the interpretation and use of benchmarking in an efforts clause

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Strategy

The authors of a recent US article appearing in Corporate Counsel explored how efforts clauses – that is, contractual provisions that require one party to a contract to exercise some standard of effort to maximize the benefits to be received by the other party to the contract – may be improved. Their hypothesis is simple:… → Read More

A Guide to Canadian M&A in the First Half of 2013

Recovery Hits Roadblock: 2013 sees decline in Canadian and Global deal volume and value

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

As we move into the second half of 2013, it seems appropriate to look back at what has gone on so far this year across the Canadian M&A landscape. Below we’ve highlighted some of the major news items and deals that have taken place so far. First Half Sees Fewer and Smaller Deals. The first… → Read More

Deal or No Deal?

The importance of knowing when you have an agreement

Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

When negotiating a deal, it is critical for parties to be aware of when they have reached an agreement. Recently, in Proton Energy Group SA v. Public Company Orlen Lietuva, [2013] EWHC 334 (Comm), the English High Court found in a preliminary motion that it was “plausible” that an email with the word “confirmed” was… → Read More

What’s so “Special” about a “Special Committee”?

The importance of context when evaluating the need to establish a special committee

Posted in Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

In a recent bench ruling in Re Plains Exploration, the Delaware Court held that a special committee was not required to take the lead in merger negotiations in circumstances where almost all of the members of the board were independent and free from conflict in connection with the transaction. In Re Plains Exploration, the Delaware… → Read More

Immigration Issues in M&A Transactions

Considerations for foreign-based companies sending employees to Canada.

Posted in Private Equity, Private Transactions, Public M&A, Strategy

Given the complexities of a typical business acquisition, it is frequently the case that immigration issues slip well down the priority list for such a transaction.  From dealing with entry into Canada for the purpose of conducting due diligence, to deciding whose responsibility it is to employ foreign workers post transaction, immigration issues should be… → Read More