On April 2, 2014, Osisko Mining Corporation announced a superior
alternative to Goldcorp Inc.'s unsolicited offer for Osisko in
the form of a partnership with Yamana Gold Inc. resulting in
Osisko's shareholders receiving cash and share consideration
with an implied value representing a 22% premium to Goldcorp's
offer. This transaction was announced 79 days after Goldcorp
announced its intention to launch its unsolicited offer.
Osisko was able to afford itself time to complete its auction
process and enter into a superior transaction by commencing a
proceeding against Goldcorp alleging misuse of confidential
information. This litigation was settled with Goldcorp agreeing not
to take up shares until April 15, 2014 (92 days after the
announcement of the offer) and with Osisko agreeing to waive its
shareholder rights plan on the earlier of April 15, 2014 and the
date Osisko entered into any third-party transaction.
In March 2013, the Canadian Securities Administrators proposed
National Instrument 62-105, setting out a new regime for the
regulation of shareholder rights plans in Canada. The proposed rule
would shift decision making regarding rights plans from securities
regulators to shareholders, to allow a rights plan adopted by a
target board to stay in place, provided shareholder approval is
obtained within specified periods. The principal implication of the
proposed rule is that a target company will be able to forestall an
unsolicited bid for 90 days or longer, if shareholder approval is
obtained, which increases the amount of time available to seek out
alternatives. Our summary and discussion of the proposed rule can
Proposed National Instrument 62-105 is reflective of a regulatory
mindset that a significantly longer period than the statutory
minimum 35-day bid period, or the 45- to 60-day period that has
commonly resulted from hearings to cease trade rights plans, should
be provided to the target board in order to allow it to run a
process with the greatest prospect of maximizing value for the
benefit of shareholders.
In the case of Osisko, it was able to afford itself sufficient
time through tactical litigation, and the time paid off in a deal
that appears to provide superior value to the initial Goldcorp
offer. It remains to be seen whether Goldcorp will top the Yamana
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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