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TSX to Require Shareholder Vote in Certain M&A Transactions


Area Corporate Finance and Securities, Mergers and Acquisitions, REITs and Income Securities, Private Equity


The Toronto Stock Exchange (“TSX”) has announced that, effective November 24, 2009, a listed issuer will be required to obtain the approval of its securityholders when the securities proposed to be issued as consideration for the acquisition of a target would increase the number of the listed issuer’s outstanding securities by 25% or more (on a non-diluted basis), regardless of whether the target is closely or widely-held.  This requirement represents a significant departure from historical practice pursuant to which acquisitions of widely-held targets were exempt from the TSX’s shareholder approval requirements (subject to the TSX’s general discretion to impose conditions on issuances).

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