TORONTO, ONTARIO and NEW YORK, NEW YORK--(Marketwired - June 6, 2017) - Just over one year ago, on May 9, 2016, Canada's new harmonized takeover bid regime, as set out in National Instrument 62-104 Takeover Bids and Issuer Bids, came into effect. The new rules stipulate three key bid features:
- Bids must remain open for at least 105 days, except that the time may be reduced to not less than 35 days with the approval of the target or in the event of friendly competing transaction;
- Bids must be for at least 50% of the target's outstanding shares, excluding any shares held by the bidder; and
- Bids must remain open for an additional 10 days beyond the initial expiry once all bid conditions have been met.
Laurel Hill, Canada's leading shareholder communications firm, has acted as Information Agent for six of the seven unsolicited bids since the new rules took effect and, as such, is uniquely positioned to provide insights on the impact of the new rules.
With this in mind, we are pleased to release our case study "Happy Anniversary NI 62-104! A case study in Canada's new takeover bid regime". The study reviews the recently completed hostile bid by Total Energy Services Inc. for Savanna Energy Services Corp., the only hostile bid in the last year that involved a share exchange and the only successful bid that played out to its end without the support of the target board.
David Salmon, President of Laurel Hill, notes: "We are now one year out from the new rules and, while the number of hostile bids has not declined as many anticipated, there has been a trend towards all-cash deals and we are also seeing targets employ increasingly creative defensive tactics. On the other hand, this particular case underlines the fact that successful bids involving share exchanges can still be made. The case also underscores the importance and the impact of shareholder lock-ups."