The Securities Commission has granted an exemption to a real estate investment trust (REIT) from certain minority approval and formal valuation requirements for related party transactions under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (MI 61-101). This exemption allows the REIT to include the indirect equity interest held in the form of exchangeable units in its market capitalization calculation. These units are economically equivalent to the REIT’s publicly traded units and represent approximately 52.63% of the REIT’s equity value.
The exemption is conditional upon the transaction qualifying for the 25% market capitalization exemption under MI 61-101, no material changes to the terms of the exchangeable and special voting units, compliance with exchange rules, and specific disclosure in the REIT’s annual information form or equivalent filings. The decision is based on the principle that the exchangeable units contribute to the equity value of the REIT and should be considered when assessing the impact of related party transactions. The exemption aims to reflect the true market capitalization of the REIT, thereby adjusting the threshold for applying minority protections in related party transactions.