The Securities Commission granted an exemption to an issuer from the requirement to take up all securities deposited under an issuer bid before extending the bid, under subsection 2.32(4) of National Instrument 62-104 Take-Over Bids and Issuer Bids (NI 62-104). The issuer, conducting an issuer bid via a modified Dutch auction, sought relief to potentially extend the bid if it was undersubscribed without first taking up all validly deposited securities. This exemption was necessary because the purchase price per share could only be calculated after knowing all tenders, which would not be possible if securities had to be taken up before any extension.
The exemption was granted subject to conditions, including that the issuer must take up and pay for the securities in the manner described in their circular, be eligible for the Liquid Market Exemption, and comply with U.S. Securities Exchange Act Rule 13e-4 and Regulation 14E.
The issuer’s bid was to purchase up to US$400,000,000 of its common shares, with the price range set between US$8.75 and US$10.25 per share. The decision was based on the issuer’s representations, including the belief that the bid would provide value to shareholders and that the current trading price did not reflect the company’s value. The issuer also confirmed it would not extend the bid if the aggregate purchase price of the shares tendered met or exceeded the maximum purchase amount by the expiration date.
The Ontario Securities Commission was the principal regulator for the application, and the issuer intended to rely on section 4.7(1) of Multilateral Instrument 11-102 Passport System in various Canadian jurisdictions. The decision was made considering the issuer’s compliance with relevant securities legislation and the potential benefits to shareholders.