50 LEXPERT MAGAZINE
|
MARCH 2016
FEATURE
THE CANADIAN SECURITIES ADMINISTRATORS'
lengthy delay in implementing proposed
changes to the hostile takeover regime is creating a great deal of confusion in the present and uncertainty
about the future in the mergers and acquisitions marketplace.
While the comment period for the proposals closed in June 2014, at press time regulators had pro-
vided no definitive answers as to when the new rules will come into force or whether the final dra
will remain true to the proposal. Meanwhile, two key decisions from securities regulators in which the
targets attempted to take advantage of the proposed new rules during the interim period also proved to
be of little, if any, assistance on the ultimate makeup of the new regime.
e upshot is that two nagging questions loom: what should targets and acquirers involved in hostile
bids do while the old rules remain in force and the new rules loom, and what final form are the rules
likely to take?
e key elements of the proposal would mandate a 120-day minimum deposit period, a 50 per cent
minimum tender requirement, and a compulsory 10-day extension of bids where the minimum tender
has been met.
Although there's a general expectation that the new rules will be in place sometime in 2016, further
delay could set in if the CSA decides to revise the proposal and seek additional public comment.
"e amendments are a blend of competing proposals from various securities regulators," says Jeremy
Fraiberg of Osler, Hoskin & Harcourt LLP in Toronto. "So, for example, although it's clear that 60 days
isn't enough as a minimum deposit period, and while the proposed amendments currently adopt 120
days, it still could turn out to be 90."
TURMOIL
Take-over
As provincial securities regulators show inconsistency
in their approaches to defensive tactics, uncertainty
continues to reign
BY JULIUS MELNITZER
PHOTO:
SHUTTERSTOCK
