Toronto Legal Blog

Mergers and acquisitions: BMO to add Clearpool to its portfolio

BMO Financial Group's coffer will be expanding thanks to a recent acquisition agreement. In mergers and acquisitions news in Canada, BMO has agreed to acquire stateside-based Clearpool Group Inc. pending regulatory approvals. Clearpool is an electronic trading solutions company and is expected to give BMO a powerful injection in electronic trading.

This deal is expected to elevate BMO's delivery of trading technology globally. BMO's CEO of capital markets said the acquisition is expected to simplify how BMO currently does business. When the deal closes in the second quarter of this year, Clearpool will be a broker-dealer on its own. BMO said it would continue to maintain Clearpool's commitment of operating with transparency and high principles.

Business and commercial: Trade tensions ease moving into 2020

Things are a little less tense in the trading realm and that is good news for companies. A recent Bank of Canada survey of executives showed businesses around the country were much less concerned about trade tensions at the end of last year. Moving into 2020, all indicators point to infrastructure growth in business and commercial areas amid tightened labour markets.

Business sentiment is largely positive around the country, the survey indicated. Healthy domestic and foreign sales are also adding fuel to that positivity. The survey, conducted between Nov. 13 and Dec. 9 last year, suggested the bright business outlook is largely due to two major happenings globally -- a wrap-up signing of the North American Free Trade Agreement (NAFTA) and an announcement of a U.S.-China phase one trade deal. 

Mergers & Acquisitions

One of the largest independent groups of agricultural retailers in the country are joining forces with others around the globe to create a major player in the world ag market. AgLink Canada has joined with AgLink Australia, Integrated Agribusiness Professionals in the United States and AgriRede in Brazil, creating AgLink International. And it's big news in the mergers and acquisitions world. 

As far as retail agriculture goes, the new entity is now the second largest of its kind in the world. The new company -- which united 112 companies -- has sales of US$3.8 billion from 664 retail outlets. Members of AgLink Canada can now buy in bulk through the new company, giving them a more relevant platform.

Many Canadian business owners plan 2020 investments

Entrepreneurs across the country are gearing up for a new year, despite some reservations about the economic outlook for the next 12 months. According to a survey from the Business Development Bank of Canada (BDC), business owners throughout the country are more pessimistic in 2020 than they were the year prior. However, many still believe their businesses will grow in the new year, and Ontario entrepreneurs say their investment intentions are on the rise for the new year.

Western provinces voiced less bold intentions in the survey, with business owners citing low commodity prices and cash flow issues as the reason for holding back on some investments in the first part of the year. However, certain companies and areas say they are on a pathway to growth. Large companies and exporters are leading the way, giving the province of Ontario more optimism than other provinces in the survey.

Cross-border mergers and acquisitions down in 2019

Worldwide deal-making in 2019 numbered in the trillions of dollars, making last year one of the best in recent history when it comes to business. Some of those deals included mergers and acquisitions in Canada -- including cross-border pursuits. Cross-border mergers and acquisitions totaled more than $1 trillion, but that is the lowest it has been since 2013.

Most companies chose to remain in their own neck of the woods when it came to dealmaking in 2019. That being said, larger companies did take some risks. Those mergers and acquisitions worth more than $10 billion rose by 8% -- the highest they have been since 2015. Meanwhile, more than 20 deals totaling more than $20 million made up about a quarter of the world's business volume last year.

Commercial litigation: Contractors say SCC ruling unjust

Construction associations in Ontario aren't too happy with the far west in Canada at the moment. The Ontario General Contractors Association (OGCA) and the Ontario Road Builders Association (ORBA) have heated up commercial litigation news in the country by saying that a reprisal clause in British Columbia is unfair. The two bodies also said that the Supreme Court of Canada's dismissal of an appeal regarding the clause could have negative ramifications for the construction industry across the country. 

Two construction companies took the City of Burnaby, British Columbia to court over paying for a sewer project and the city then blacklisted them from bidding on further projects. A B.C. court decided to uphold the use of reprisal clauses which the Supreme Court also upheld on appeal. The president of the OCGA called the decision an abuse of power and intimidation, adding the decision is a threat to the constitutional right for justice for everyone.

Business and commercial: AC investors could get a bumpy ride

Canada's number one airline continues to fly high in more ways that one. Those in Canada who follow business and commercial news may know that the last four years have been a roller coaster of changes. But company stock continues to do well as investors continue to buy in on the brand and stay on the same page with the airline's cost-cutting measures.

To top it off, Air Canada recently acquired Air Transat with the deal to close in the second quarter of 2020. Takeover price was $18 per share. Analysts say that if the Transat deal does go through as expected, Air Canada is poised to control nearly half the domestic market. Some analysts are saying, however, regulatory hurdles could still block the sale of Transat to Air Canada and some advise investors to consider selling their Air Canada stock before it heads into a tailspin.

Business and commercial: Chart conveys economic outlook for 2020

Each year a well-known and well-respected Canadian news magazine puts together an economic chart highlighting various facets of business such as real estate, the GDP and the trade sector. It also speaks to the general business and commercial climate of Canada and what to watch for in particular moving into the next year. A number of analysts, economists, financial experts and investors have given their input to create the chart.

According to these people, productivity growth still needs to rally in the country, which is still relying on money and people to fuel growth, while factories in Canada have become and will continue to become more sensitive to the inflation of wages. On a positive note, direct investment in the country from the foreign faction is recovering and gaining momentum. This is being led by the service and manufacturing sectors.

Mergers and acquisitions: 2 big cannabis players unite

An all-share deal recently went down in the cannabis industry to the tune of millions of dollars. WeedMD Inc., an Ontario cannabis grower, recently acquired Starseed Holdings Inc. The mergers and acquisitions deal is worth $78 million. Starseed Holdings is backed by the Laborers' International Union of North America (LiUNA), which is investing $25 million in WeedMD.

The CEO of WeedMD said the cash will help the company in an industry where financing is becoming difficult. Starseed -- based out of Toronto -- has a different business model from most competing companies. Its subsidiary company, Starseed Medicinal,  provides cannabis to union members who have insurance coverage for it. It sells cannabis at preferential prices to LiUNA Local 183 members who need it. The company buys cannabis at wholesale prices rather than cultivate it itself.

Business and commercial: CN strike adversely affecting economy

A more than week-long railway strike is leaving its mark on the Canadian economic landscape. About 3,200 Canadian National Railway Co. (CNR) rail yard operators and conductors in Canada took to the picket lines and the fallout is being felt in the business and commercial sectors of the country. In fact, layoffs and shutdowns are expected as the strike is affecting the shipping of cargo. 

Many of the nation's chemistry facilities are nearing the point of closing up shop temporarily since many can't receive the materials the need to maintain operations. The dispute between CNR and strikers hinges on working conditions and benefits. If the strike lasts longer than Dec. 5, it could have a severe impact on the nation's export industry, economists say. This is also the date when parliament reconvenes and when lawmakers have the power to order employees back to work. 

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