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Category Archives: Shareholders

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

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

By Ian C. Michael, Shane C. D'Souza and Zachary Masoud on 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

Can we talk?

Considerations for disclosure of material information in the necessary course of business.

By Patrick Boucher on Posted in Public M&A, Shareholders

Your company is contemplating a potential transaction and you would like to share your project with one or more major shareholders before any public announcement in order to maintain good relations with them and validate whether they would be supportive of the potential transaction. Senior executives of Canadian public companies often wonder to what extent… → Read More

You Can’t Always Get What You Want

Making realistic projections during an auction process

By Robert Hansen and Shane C. D'Souza on Posted in Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

The recent Delaware ruling in In Ancestry.com Inc. Shareholder Litigation provides a cautionary tale relating to a target company developing aggressive projections during an auction process. The Relevant Facts Following the announcement of a going-private transaction, some shareholders of Ancestry.com filed suit in the Delaware Court of Chancery alleging, among other things, that the board… → Read More

Challenges for State-Owned Enterprises Arising From Proposed Amendments to the Investment Canada Act

By Oliver J. Borgers and Michele Siu on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

The Canadian government’s Bill C-60 contains proposed amendments to the Investment Canada Act that will significantly impact foreign investors whom the Canadian government considers as state-owned enterprises (SOEs).  An investor might be an SOE even if a foreign state only indirectly “influences” the investor.  Under these amendments, if the Minister of Industry determines that an… → Read More

Ignorance is not bliss: beware minimal due diligence

Lessons from the Quebec Court of Appeal

By Martin Boodman and Shane C. D'Souza on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

The Quebec Court of Appeal’s decision in Francoeur v. 4417186 Canada Inc., 2013 QCCA 191, provides a cautionary tale on the dangers of entering into a share purchase agreement and subsequently closing a share purchase transaction, without ample due diligence. The one-sided apportionment of risk The Francoeur share purchase agreement (the “SPA”), which was signed… → Read More

The Spin on Spin-Offs (Part 3)

A Valuable Tool to Unlock Shareholder Value

By David Randell and Omar Soliman on Posted in Public M&A, Shareholders, Strategy

In our recent series on corporate-spin off transactions, we focused on why a company should consider a spin-off, and how the spin-off could be implemented. In this post, we briefly outline some of the common risks that a company should be aware of before pursuing the spin-off. Even for seasoned practitioners, a great deal of… → Read More

The Spin on Spin-Offs (Part 2)

A Valuable Tool to Unlock Shareholder Value

By David Randell and Omar Soliman on Posted in Public M&A, Shareholders, Strategy

In our last post, we outlined some of the reasons why corporate spin-offs are used. In this post, we address some of the most common methods used to implement the corporate spin-off. How do I implement it? In some cases, a Canadian public corporation seeking to distribute shares of Spinco to its shareholders will be… → Read More

Don’t be a “Dummy Director”

Delaware ruling on the obligations of directors of companies operating in emerging markets

By Ian C. Michael and Shane C. D'Souza on Posted in Public M&A, Shareholders, Strategy

        “Independent directors who step into these situations involving essentially the fiduciary oversight of assets in other parts of the world have a duty not to be dummy directors.” p. 21 of transcript, In re Puda Coal Stockholders Litigation, Del. Ch. C.A. 6476-CS (February 6, 2013). A recent Delaware bench ruling considers… → Read More

Doing Business in Canada – 2013 Edition

Buying a Canadian Business, eh? A look back.

By Robert Hansen and Heidi Gordon on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

Last Spring we announced a special series of blog posts aimed at addressing some of the most significant distinctions between Canadian and US law that ought to be considered in the early stages of the proposed acquisition of a Canadian target. Following the launch of that series our team blogged about important topics like: Financing… → Read More

The Spin on Spin-Offs (Part 1)

A Valuable Tool to Unlock Shareholder Value

By David Randell and Omar Soliman on Posted in Public M&A, Shareholders, Strategy

On March 6, 2013, Time Warner Inc. issued a press release announcing plans to implement, courtesy of a spin-off transaction, a “complete legal and structural separation of Time Inc. from Time Warner.” The proposed spin-off highlights an increasing trend among public companies in the face of tough market conditions – the transformation of what are… → Read More

Proposed Changes to Early Warning Reporting System Address Market Transparency and Shareholder Activism in Canada

By Cristian Blidariu, Jonathan Grant, Ian C. Michael, Sean Sadler, Rene Sorell and Sonia J. Struthers on Posted in Public M&A, Shareholders, Strategy

Under Canada’s early warning reporting (EWR) system, investors holding 10% or more of a public company’s voting securities must publicly report their ownership levels, the purpose of the transaction and any future intention to accumulate more securities. Eligible institutional investors can report more slowly than EWR filers and provide less information by making use of… → Read More

Shareholder Rights Plans – The CSA Proposal

By Graham Gow, Clemens Mayr, Ian C. Michael and Leslie Milroy on Posted in Public M&A, Shareholders, Strategy

On March 14, 2013, the Canadian Securities Administrators (otherwise known as the “CSA”) published a request and notice for comments regarding Proposal National Instrument 62-105 – Security Holder Rights Plans, the purpose of which is to introduce the CSA’s proposed regulatory regime for rights plans. The proposed rule, which is discussed in more detail in… → Read More

Defensive Tactics – The AMF Alternative Approach

By Clemens Mayr and Benjamin Silver on Posted in Public M&A, Shareholders, Strategy

On March 14, 2013, the Autorité des marchés financiers has published a consultation paper regarding An Alternative Approach to Securities Regulators’ Intervention in Defensive Tactics (the “AMF Approach”). Concurrently, the Canadian Securities Administrators (otherwise known as the “CSA”) published a request and notice for comments regarding Proposal National Instrument 62-105 – Security Holder Rights Plans,… → Read More

Advance Notice By-Laws & Defending Against a Surprise Attack

By David Randell and Graeme Norwood on Posted in Public M&A, Shareholders, Strategy

Shareholders typically have three options available to them when looking to nominate directors different than those put forth by the company’s management, (i) a shareholder proposal that is added to the management proxy circular for the applicable shareholder meeting, (ii) the more popular and publicized proxy contest, which generally requires that the shareholder(s) soliciting proxies… → Read More

Plugging (You Into) Even More Online M&A Resources

More Online Resources for Deal Makers – What you should know about (Part 2 of 2)

By Ian C. Michael and Lama Sabbagh on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

In our last post, we looked at six traditional resources and more sophisticated paid services that help bring us up to speed in the M&A world. In this post we will list some of the more contemporary deal commentary resources:     NY Times DealB%k: This blog delivers the latest news on mergers, acquisitions, venture… → Read More

Plugging (You Into) Online M&A Resources

Top 6 Online Resources for Deal Makers – What you should know about (Part 1 of 2)

By Ian C. Michael and Lama Sabbagh on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

Whether you’re a seasoned deal maker or just starting out, we all rely on various resources to stay apprised of the cutting edge developments in M&A. Given that the latest information is driven by online resources, we thought it would be appropriate to put together a list of our favourite resources that help keep us… → Read More

Fibrek: Where are we now in the regulation of defensive tactics?

By David E. Woollcombe and Leslie Milroy on Posted in Public M&A, Shareholders, Strategy

Resolute’ s battle for ownership of 100% of Fibrek Inc. recently came to an end with a friendly “white knight” offer from Mercer being withdrawn after a lengthy court battle. Resolute’s hostile bid for Fibrek was successful, notwithstanding that Fibrek’s board had endorsed Mercer’s offer at a 40% premium to the hostile bid. The Fibrek… → Read More

Hot Off the Press – Updated Canada Tax Service Quick Reference Guide 2012

By McCarthy Tétrault LLP on Posted in Contractual Matters, Private Equity, Private Transactions, Public M&A, Shareholders, Strategy

For those interested, the updated edition of McCarthy Tétrault’s 2012 biannual Canada Tax Service Quick Reference Guide is now available on Thomson Reuters/Carswell’s website. The handy booklet is an excellent reference tool for tax practitioners, financial advisors, businesses and individuals seeking pertinent tax rates and facts. Ylang Ha, Douglas Cannon, Frédéric Harvey, Nigel Johnston, Gabrielle… → Read More

Reverse Takeovers – An Alternative Exit Strategy

Reverse takeovers may be a worthwhile alternative for business owners looking for an exit strategy, especially during a cool IPO market

By Genevieve Pinto on Posted in Public M&A, Shareholders, Strategy

What is a reverse takeover? When evaluating possible exit options, an alternative to the typical IPO or sale transaction is a reverse takeover transaction (often referred to as an “RTO”). An RTO is a type of sale transaction where the shareholders of a company, often an unlisted entity, sell the company to a publicly listed… → Read More

Should proxy advisory firms be regulated in Canada?

By Lara Nathans and Leslie Milroy on Posted in Public M&A, Shareholders, Strategy

On June 21, 2012, the Canadian Securities Administrators (otherwise known as the “CSA”) published Consultation Paper 25-401 – Potential Regulation of Proxy Advisory Firms, the purpose of which is to obtain feedback regarding some of the concerns raised by market participants in order to assist the CSA with determining whether there is a need to… → Read More

Shareholder Rights Plans – A Priority for the OSC

By Robert Hansen on Posted in Public M&A, Shareholders

On June 28, 2012, the Ontario Securities Commission published OSC Notice 11-767 – Notice of Statement of Priorities for Financial Year to End March 31, 2013. Tucked in with the OSC’s goal to deliver strong investor protection, the OSC states that it will reconsider the current regulatory requirements governing shareholders’ rights plans to reflect recent… → Read More

5 Things US Activist Investors Need to Know about Canada

By Matthew Cumming on Posted in Public M&A, Shareholders, Strategy

With the recent election of seven nominees to the board of CP Rail, Bill Ackman and Pershing Square demonstrated in dramatic fashion that no Canadian company is immune from the rough-and-tumble world of proxy battles. Mason Capital also illustrated this recently with its successful opposition to the proposed share conversion of Telus Corp.  Shareholder activism… → Read More

Poison Pill 101: Shareholder Approved and Tactical Pills

By Max Thelonious Rogan on Posted in Public M&A, Shareholders, Strategy

One of the key questions in connection with the decision to adopt a poison pill, or shareholder rights plan, is whether the rights plan should be “shareholder-approved” or “tactical”. A shareholder approved plan is implemented for an extended period of time to serve as general protection against future unsolicited bids. A tactical plan, on the… → Read More

Plan of Arrangement – A Flexible “Made-in-Canada” Acquisition Structure

By Robert Hansen and Heidi Gordon on Posted in Public M&A, Shareholders, Strategy

Our colleague Matthew Cumming recently discussed some of the most important considerations when choosing between a take-over bid and a plan of arrangement for the acquisition of a Canadian public company. But if you’re like many of our other friends to the South, perhaps you’re wondering, what exactly is a plan of arrangement? The answer… → Read More