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Baffinland - The End of the Auction Generally Means the Time has Come for a Pill to Go


Lawyer Jonathan Feldman, Neill May
Area Corporate Finance and Securities


On November 19, 2010 the Ontario Securities Commission cease traded the shareholder rights plan of  Baffinland Iron Mines Corporation (“Baffinland”), three days ahead of the scheduled expiry of the unsolicited bid for Baffinland that had been made by Nunavut Iron Ore Acquisition Inc. (“Nunavut”).  While the Commission’s reasons have not been released, its decision to cease trade the Baffinland rights plan would appear to reaffirm that the Commission will be inclined to find that the “time has come for a plan to go” if a target has agreed to support a transaction - thereby ending an “auction” and a search for alternative transactions - and will not, in the absence of “coercion”, allow a rights plan to be used to “level the playing field” between competing transactions.

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