Sep. 23, 2016
A recent Alberta court ruling has indicated that companies cannot block shareholder votes on key mergers and acquisitions, according to an article in The Globe and Mail. In her article, Janet McFarland examines a decision by Justice Alan Macleod of the Alberta Court of Queen’s Bench, which ruled Alberta Oil Sands Inc. had to give the option to its shareholders to vote on a potential merger with Marquee Energy Ltd. Justice Macleod criticized the usage of a complicated form of plan of arrangement while structuring the transaction, while believing there was opposition from key shareholders like Smoothwater Capital Corp., according to the article. Osler litigation partner Tristram Mallett, who acted for Smoothwater in the case, says Justice Macleod’s ruling offers more clarity and flexibility for using plans of arrangement under the proper scenarios.
“It will serve as a discipline against improperly motivated deal structures, but will not impede creativity in properly motivated transactions,” Tristram tells The Globe and Mail.
To learn more about the implications of the ruling, read Janet McFarland’s full article “Alberta court ruling signals companies can’t block shareholder vote” in The Globe and Mail.