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ADMINISTRATIVE LAW | SPPA / Fairness (Administrative)

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Corporations - Publicly-traded Corporations

. Re Torstar Corporation and Nordstar Capital LP

In Re Torstar Corporation and Nordstar Capital LP (Div Ct, 2020) the Divisional Court considered issues relating to a corporate "fairness hearing", where an offer to buy-out publicly-held shares is examined for it's impact on the interested parties. One of the issues was whether a competing buyer had standing in such a hearing:
[21] The Supreme Court of Canada determined in BCE Inc., that a fairness hearing “looks primarily to the interests of the parties whose legal rights are being arranged.” The court must be satisfied that (a) the arrangement has a valid business purpose, and (b) the objections of those whose legal rights are being arranged are being resolved in a fair and balanced way, paras. 119 and 138.

[22] First, the CMMH interest in these proceedings (to the extent it has one at all) is purely commercial and self-interested. It made an offer to purchase assets which was not accepted. No “legal rights” of CMMH are being arranged.

[23] Second, the Arrangement Agreement is a contract between Torstar and NordStar. CMMH is not a party to this contract nor is it an intended beneficiary. CMMH, therefore, has neither obligations of its own nor can it enforce the obligations of others under the Arrangement Agreement.

[24] Finally, this is not a case where CMMH’s standing is required in order for this matter to be brought before the court. ....


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