LEXPERT MAGAZINE
|
JANUARY/FEBRUARY 2017 33
| TOP DEALS |
LLP; Kirkland & Ellis LLP; Norton
Rose Fulbright Canada LLP (litigation,
finance); McCarthy Tétrault LLP
7
Corus
Entertainment's
Acquisition
of Shaw Media
On April 1, 2016, Corus Entertain-
ment Inc. acquired the business of Shaw
Media Inc. from Shaw Communications
Inc. is acquisition more than doubled
Corus's size, creating a combined portfolio
of brands encompassing 45 specialty tele-
vision services, including leading women
and lifestyle, kids, family and general en-
tertainment brands; 15 conventional tele-
vision channels; 39 radio stations; a global
content business; book publishing; and a
growing portfolio of digital assets.
Corus paid a purchase price of $2.65
billion for Shaw Media, subject to certain
post-closing adjustments, which was sat-
isfied by Corus through a combination
of $1.85 billion in cash and the issuance
by Corus to Shaw of 71,364,853 Class B
Shares (CJR.B) at an agreed upon value of
$11.21 per share.
is deal exemplified the closely held na-
ture of Canadian business. Corus was spun
out of Shaw 15 years ago, with the Shaw
family in common as the majority share-
holder of both companies. ey therefore
had two companies in the broadcast tele-
vision business. As Doug Bryce of Osler,
Hoskin & Harcourt LLP explained, in a
context of current trends in the broadcast
TV business, Shaw moved to place the
Wind mobile business in one company and
to continue the broadcast TV (and radio)
business in the other.
Because the acquisition constituted a
related-party transaction for purposes of
Multilateral Instrument 61-101 Protection
of Minority Security Holders in Special
Transactions (MI 61-101), it required a for-
mal valuation (which was provided by Bar-
clays Capital Canada Inc.) and Corus mi-
nority shareholder approval. Each of Corus
and Shaw struck independent special com-
mittees to, among other things, review and
negotiate the terms of the acquisition.
ere was also a shareholder activism
piece to this deal. e Catalyst Capital
Group Inc. announced its opposition to
the acquisition, conducted a dissident
proxy campaign and made a case against
the transaction to the OSC, which ulti-
mately did not succeed.
FRANK CALLAGHAN
BORDEN LADNER GERVAIS LLP
The Corus/Shaw/
Catalyst saga, among
other things, reinforced
the importance of
having a robust special
committee process in a
related-party transaction
… to be able to answer
to activist investors
who will look for any
flaw in the process
to challenge a deal."
"
Shaw was represented by Davies Ward
Phillips & Vineberg LLP with a team led
by Vincent Mercier.
e Shaw special board committee was
represented by Goodmans LLP with a
team that included Stephen Halperin and
Robert Vaux.
e Corus special board committee was
represented by Borden Ladner Gervais
LLP with a team led by Frank Callaghan.
He commented: "e Corus/Shaw/Cata-
lyst saga, among other things, reinforced
the importance of having a robust special
committee process in a related-party trans-
action, not only to allow the board to fulfill
its legal duties, but also to be able to answer
to activist investors who will look for any
flaw in the process to challenge a deal.
"e deal also highlighted the need of
special committees to be sensitive to the
fact that activist shareholders will add an-
other level of scrutiny to the committee's
process and may try to involve regulators in
the process."
Key Legal Players
Corus advisors: Gary Maavara
(in-house); Osler, Hoskin & Harcourt LLP
(M&A, corporate finance, regulatory);
Dentons Canada LLP (corporate finance);
McCarthy Tétrault LLP (regulatory)
Shaw advisors: Peter Johnson (in-house);
Davies Ward Phillips & Vineberg LLP
(M&A, litigation, tax, regulatory, banking)
Advisor to the Corus special commit-
tee: Borden Ladner Gervais LLP (M&A)
Advisor to the Shaw special commit-
tee: Goodmans LLP (securities)
Advisor to securities underwriters and
lenders for the Corus debt financings:
McCarthy Tétrault LLP (securities)
Catalyst Capital Group counsel:
Bennett Jones LLP (litigation)
Barclays Capital advisor: Blake,
Cassels & Graydon (M&A)
8
Sprott's Takeover
of Central GoldTrust
On January 15, 2016, Sprott Asset Man-
agement LP completed its successful hos-
tile takeover bid to acquire all of the out-
standing units of Central GoldTrust in
exchange for units of Sprott Physical Gold
Trust on a net asset value to net asset value
basis. e transaction was valued at more
than $1 billion.
Sprott Asset Management was rep-
resented externally by Stikeman Elliott
LLP with a team that included John
Ciardullo and Paul Collins. Ciardullo said:
"e Sprott transaction emphasized what I
like most about what we do — the ability
to come up with a really creative structure
that ultimately gets tested and not only
survives but serves to facilitate the delivery
of a prized asset to your client and tangible
value to the target's security holders. Given
the unique structure, non-stop court and
securities regulatory activity, the deal was a
roller-coaster ride from beginning to end."
