Toronto Legal Blog

Business and commercial: US tariffs causing some issues in Canada

It doesn't seem to be business as usual. There have been many changes in the business and commercial world in Canada with the onset of U.S. tariffs on certain goods. The dairy company Saputo is blaming its U.S. rivals for its 37 per cent net income fall in the first quarter of the year. Saputo's CEO said the company is seeing some unusual things in a competitive market that the industry hasn't seen before, including the stockpiling of products.

But where the company is feeling most of the burn is with milk since competitors are increasing output. The plant is fighting back with its cheese sector since this is an area where Saputo excels at making it better and more efficiently than its competitors, according to the CEO. The problem lies in getting workers since many aren't willing to put in the overtime necessary to churn out extra product.

Mergers and acquisitions: Deals in Canada on the rise

Many Canadian companies are looking internationally to secure deals. Mergers and acquisitions in Canada are robust, hitting $93 billion in the first part of this year. It seems the upswing is due to the burgeoning cannabis industry, real estate and energy areas. A recent review of PricewaterhouseCoopers in Canada suggests deals stateside have increased by 8 per cent, while there have been more than 160 outbound international deals struck.

It is no coincidence that the legalization of recreational marijuana in Canada has significantly impacted the market. Forty-eight deals having to do with cannabis happened in the first half of this year, worth more than $5 billion. Capital is flowing freely, allowing investors and company owners to acquire new means of distribution as well as to enter new markets and expand their bases.

Mergers and acquisitions: Group wants aeroplane business

Two Canadian banks along with the nation's airline made a hostile bid recently for the Aeroplan rewards program of Aimia Inc. The bid, worth $2.25 billion, and which involves Air Canada, rocked the world of mergers and acquisitions in Canada. The bid was a shocker in the business world since about a year ago Air Canada said it would be cutting its ties with Aimia to start its own reward program.

A statement from Aimia suggests Air Canada approached the company in good faith and is seeking legal and financial advice as to whether the deal on the table will positively serve the company and its shareholders. Banks in on the proposed deal include the Toronto-Dominion Bank and the Canadian Imperial Bank of Commerce. Both these institutions offer Aeroplan loyalty program credit cards through Visa Canada.  The bid is comprised of $250 million in cash plus the assumption of $2 billion in Aeroplan points liability.

Business and commercial: Costco offers online shopping, delivery

One of the largest bulk buying chains in Canada has introduced a new service. In business and commercial news, Costco is now adding online shopping and delivery to its roster of services. The company is putting its feelers out for the new service in Southern Ontario first before rolling it out to the rest of the province and into Quebec. Shoppers who spend upwards of $75 can take advantage of the service.

Costco is trying to remain competitive with its competition, like Amazon, which will soon be offering a similar service in Canada for groceries. Costco's online orders will be processed in Toronto by dozens of employees who have been hired for the company's new foray into online grocery sales. Costco Canada's senior vice-president said the company is starting this new venture in a small way to be able to provide the service Canadian members of the store expect.

Mergers and acquisitions: Company receives $10M termination fee

A medical marijuana grower in Aylmer has been paid $10 million after it was pushed aside in a business deal. In terms of mergers and acquisitions deals, the Ontario grower was set to merge with a larger foreign company in what would have been a $240-million deal. The other company inked a deal with the nation's biggest grower instead.

WeedMD's stock tumbled down 16 per cent as a result of the axed deal with Hiku Brands Co. Ltd., but its CEO says there's no real fallout from the deal bust and that mergers and acquisitions can be distracting if they're allowed to be. He said the company will move forward and is happy with the $10 million termination fee paid. The company has been housing its grow op in an 8,000-square-metre former tobacco facility in Aylmer.

Business and commercial: Tariffs and hot dog toppings

The tariff war between Canada and the United States is not being very complimentary to condiments. When it comes to business and commercial decisions, Canada's mustard seed farmers are breathing a collective sigh of relief. Canada has decided to drop mustard seed from its list of items on its retaliatory tariffs list, but ketchup, its cousin, is still on that list.

Canada is one of the world's largest producers of mustard seed. Several groups lobbied Ottawa to have tariffs on some products removed, and while some things -- like boats, ketchup and even dishwashers -- remain on the list, mustard does not. Farmers were worried that a mustard tariff would have lowered export prices for the seed to its largest importer, the United States. It was also concerned the U.S. might have slapped tariffs on Canadian mustard seed.

Mergers and acquisitions: Insurance companies looking healthy

The nation's three largest insurance companies are seeing real action in many respects. At their annual general meetings recently Canada's Great-West Lifeco, Manulife and Sun Life Financial presidents let their shareholders and employees know about what's been happening. In the world of mergers and acquisitions, Great-West Lifeco is on the acquisitions trail, Manulife is focused on customer service, while Sun Life continues to grow.

The busiest company when it comes to mergers and acquisitions is Great-West Lifeco. In Canada, the real estate management arm of the company, GWL Realty Advisors, recently acquired EverWest (based in the United States). The president and CEO of the company said that deal provides Great-West Lifeco with a solid real estate platform stateside, opening up to investment opportunities for the company's Canadian clients.

Business and commercial: Ontario teen learns a lot at forum

When it comes to business acumen, a young Oakville woman has it going on. The 17-year-old high school student showed the business and commercial world that she knows what she's talking about at the recent Young Entrepreneurs, Make Your Pitch competition sponsored by the Ontario Centres of Excellence (OCE) and the Ontario government. The young woman was one of several who pitched their business ideas via a short video to be judged by both judges and the public.

Her idea was for a T-shirt company called Jenna that would highlight art created by student artists with 10 per cent of sales earmarked for the Citizens Foundation. The foundation is a nonprofit group that helps Pakistani boys and girls have equal access to education. The organization has been building schools in Pakistan for the past 13 years and it has an equal male to female student ratio.

Mergers and acquisitions: Biggest oil patch deal of the year

It is the biggest deal of the oil patch this year, yet investors are not exactly smiling. In the world of mergers and acquisitions in Canada, Baytex and Raging Rivers' $2.8B merger is big news. But it has been met with a chilly reception from investors.

Part of the reason for the deal, according to both sides, is to create a mega corporation with the muscle to develop Raging River's assets in the expensive Duvernay shale play in Alberta. Proponents of the deal say this merger would produce more than 100,000 barrels of natural gas liquids and oil this year alone. According to both sides, the two companies complement each other well and moving forward, they believe merging is the right move.

Star Power Could Spell Significant Revenue For Toronto Triple-Threat

What do sushi, hotels, and condos have in common? As it turns out, quite a bit if you’re talking about Nobu. The brainchild of actor Robert De Niro, chef Nobu Matsuhisa, restaurateur Drew Nieporent, and producer Meir Teper, Nobu Hospitality LLC is taking Toronto by storm. So how does the city stand to benefit from the entertainment district’s newest resident? According to the company’s expected revenue, we can expect to see US$1 billion within the next 5 years.

 

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