May 18, 2020
“Proximity analysis” is one factor that could potentially be examined in the Canadian federal government’s review of Shandong Gold Mining Co. Ltd.’s proposed takeover of TMAC Resources Inc., Osler partner Peter Glossop tells The Globe and Mail. In their article, authors Robert Fife, Steven Chase and Niall McGee discuss this proposed takeover and how the government announced in April that it “would bring ‘enhanced scrutiny’ to bear on acquisitions by foreign state-owned investors in a period where the COVID-19 pandemic has driven down the value for companies.” The article also references how TMAC’s mine is located in the Arctic and in proximity to the strategic Northwest Passage.
“What we call proximity analysis is something that’s taken into account in a national security context,” Peter tells The Globe and Mail.
According to the article, since 2012, 22 foreign takeover deals have been reviewed under the Investment Canada Act. Peter says it can sometimes be hard to gauge which way the government will lean in its reviews.
“Part of the challenge in dealing with these cases is you don’t know what you don’t know, and the government will always have a better understanding in their mind of what might be important to them,” Peter tells The Globe and Mail.
If you subscribe to The Globe and Mail online, read more in the article, “Ottawa urged to consider Beijing’s growing control over strategic minerals when weighing Chinese state firm’s bid for gold miner,” by authors Robert Fife, Steven Chase and Niall McGee.