A Case Study in Canada’s New Takeover Bid Regime
In light of the one year anniversary of Canada’s new takeover bid regime (as set out in National Instrument 62-104 Take-Over Bids and Issuer Bids) that took effect in May 2016, requiring, among other things, that bids must remain open for at least 105 days (subject to certain exceptions), we thought it would be beneficial to review in detail one of the unique and most interesting unsolicited bids from year one, namely the Total Energy Services Inc. (“Total”) hostile offer (“Offer”) for Savanna Energy Services Corp. (“Savanna”).
To the surprise of many, there have been seven hostile bids since the bid regime took effect – a number that is effectively unchanged from recent years. Of the seven, the Total Offer for Savanna had two distinct features: First, it was the only unsolicited bid involving a share exchange (subsequently amended to add cash) and, second, it was the only successful bid that played out to its end without the support of the target board.
As expected during an unfriendly transaction and over the course of nearly four months, this bid encoun-tered many challenges and developments. For readers interested in the complete blow-by-blow, we have summarized further below the salient points of the press releases issued by each of Total and Savanna during the Offer period. However, here are the highlights:"Taseko has worked with the team at Laurel Hill for many years. When it came to the Requisitioned Meeting, Laurel Hill was an integral component of our team. Their insight and experience was key to forming our strategy which resulted in overwhelming support from our shareholders. In the end, the Dissidents withdrew their request prior to the proxy cut-off due to the lack of shareholder support. A landslide victory for Taseko and our shareholders."