The Role of Private Placements in Canada's New Take-Over Bid Regime, The M&A Lawyer

Jonathan Feldman, Chris Sunstrum and Matt Prager co-authored the article "The Role of Private Placements in Canada's New Take-Over Bid Regime", originally published in The M&A Lawyer, May 2016.

Excerpt:

Meaningful changes to Canada’s take-over bid regime that took effect on May 9, 2016 are expected to significantly impact the way target boards respond to unsolicited or “hostile” take-over bids.   Among other things, the new rules allow a majority of shareholders to determine (through their tender decisions) whether or not a hostile bid can proceed and provide target boards with substantially more time to persuade shareholders to reject a bid or implement alternatives to the bid.  The amendments also render the primary tool historically used by target boards – the shareholder rights plan or “poison pill” – effectively irrelevant as a tactical response to a hostile bid.