LEXPERT MAGAZINE
|
JANUARY/FEBRUARY 2017 29
10
Top
WITH LOW OIL PRICES AND AN UNFAVOURABLE
EXCHANGE RATE, FORECASTERS
MAY HAVE PREDICTED A DISCOURAGING
ENVIRONMENT FOR OUTBOUND
TRANSACTIONS. LAST YEAR'S
TOP DEALS DEFIED THE ODDS
BY JEAN CUMMING
OVERALL IN 2016,
there were several outbound deals, including Fortis's acquisition of
Michigan-based ITC Holdings and Enbridge's acquisition of Spectra Energy. Lawyers told
us that their "Canadian Champion" clients, be they Canadian-owned or otherwise, were
faced with a lack of domestic targets. So in order to take their businesses to the next level,
they had to move out or expand their footprint in the US and other countries.
One might have thought the unfavourable Canada/US exchange rate would have been
more inhibiting. It was a "bump" certainly on at least one deal, but lawyers told Lexpert that
many of their acquiring clients already had operations in the US and so had come to terms
with the exchange-rate delta. And Canadian investors seemed to back them up, being fairly
confident about the benefits of consolidation.
e outbound is not, of course, extant. In industrial sectors where Canadian ownership
is mandated, consolidation took place between companies in Canada. is counter-trend
is best exemplified in Corus's purchase of Shaw Media, where the majority owner of both
companies was the same Canadian family.
In both scenarios, lawyers we spoke to noticed the leadership at the top that drove their
clients' deal-making success. Indeed, a strong leadership team and ensuing corporate culture
made both targets and acquirers attractive. is was exemplified in our Deal of the Year, the
acquisition of ITC Holdings by Fortis.
Deals
COVER STORY
OF
2016