The Securities Commission has granted Imperial Oil Limited (the Filer) an exemption from certain requirements in connection with its proposed issuer bid to purchase a portion of its outstanding common shares (the Shares) via a modified Dutch auction. The exemptions pertain to:
1. The proportionate take-up requirements in section 2.26 of National Instrument 62-104 Take-over Bids and Issuer Bids (NI 62-104), which normally require shares to be taken up and paid for on a pro rata basis.
2. The related disclosure requirements in Item 8 of Form 62-104F2 Issuer Bid Circular for the issuer bid circular.
3. The extension take-up requirement in subsection 2.32(4) of NI 62-104, which restricts extending an issuer bid unless all securities deposited and not withdrawn are first taken up.
The Filer, headquartered in Alberta, is a reporting issuer in Canada with Shares listed on the Toronto Stock Exchange and NYSE American. Exxon Mobil Corporation owns approximately 69.6% of the Filer’s issued and outstanding Shares.
The Filer’s Offer aims to purchase Shares up to an aggregate purchase price of $2,500,000,000, with the purchase price per Share to be determined within a specified range through a modified Dutch auction. Shareholders can tender their Shares in various ways, including auction tenders, purchase price tenders, and proportionate tenders.
The exemption allows the Filer to determine the final purchase price after the initial expiry of the Offer, considering all Shares tendered during any extension period. This is necessary because the Filer cannot know all Auction Prices at the initial expiry, which would prevent it from taking up Shares at that time.
The Filer intends to rely on the liquid market exemption from the formal valuation requirements under Multilateral Instrument 61-101 and will include a Liquidity Opinion in the Circular confirming a liquid market for the Shares.
The decision is contingent on the Filer taking up and paying for the Shares as described, being eligible to rely on the Liquid Market Exemption, and complying with Regulation 14E of the United States Securities Exchange Act of 1934.
The Alberta Securities Commission is the principal regulator for this application, and the decision also represents the decision of the Ontario securities regulatory authority. The Filer has notified that it will rely on Multilateral Instrument 11-102 Passport System in other Canadian jurisdictions, excluding Alberta and Ontario.