Publications 

17 January 2020

Bombardier has a 50% chance of being in rail business in three years

Michel Nadeau, executive manager at the Institute for Governance and former deputy CEO at Caisse de dépôt, weighs in on Bombardier’s struggles. He says that while he believes the company will survive, it will be a much small corporation. He also says that there is a 50% chance that the Montreal-based business will still be […]

10 January 2020

The Angels of Market Efficiency

Mr. Ben Axler, Chief Investment Officer and founder of Spruce Point Capital responds (Financial Post, December 17th, 2019) to my article on short sellers of his kind (Financial Post, December 13th, 2019). He trots out the worn-out argument that short sellers only reveal the sordid truths hidden in the bosom of corporations. In short, “professional” […]

13 December 2019

Limiting the damage of short-sellers

When any individual investor or fund comes to the conclusion after careful analysis that a company is over-valued, it may very well sell short the shares of that company. Fair enough. If the analysis proves right, facts on the ground will confirm it eventually and the stock price will drop. But that’s not the game plan […]

22 November 2019

RONA: a tragedy in three acts

Act I: In July 2012, the American corporation, Lowe’s, makes some noise about acquiring RONA, the Quebec-based chain of hardware stores. Coming on the eve of an election campaign in Quebec, the prospect of a foreign acquisition of a “strategic” Quebec company generates strong reactions and a sort of political consensus: “The Quebec government must […]

7 November 2019

Carried Interest Warning From Court May Be Trouble for Treasury

A recent court case meant to clarify the definition of a corporation intensifies questions about the tax treatment of carried interest, a prized perk for private equity and hedge fund managers. The IRS argued for a broad definition of the term “corporation” in the case. But the legal issue that could come up in the […]

6 November 2019

Mergers and acquisitions: Feds, activists disrupt US economic growth

By all indications mergers and acquisitions (M&A) activity is on the rise. In the first five months of 2019, companies announced over $1 trillion in mergers and acquisitions, a 14% increase from the same period in 2018. This is generally good for the economy, the consumer and the shareholders alike. In fact, all Americans benefit […]

24 October 2019

Securities regulator to review share sale plans in wake of Bombardier controversy

Canada’s securities regulators are launching a review of automatic share sale programs after controversial trading last year at Bombardier Inc. led to calls for reform by investor rights advocates. The Canadian Securities Administrators (CSA), an umbrella organization for provincial securities watchdogs, said on Thursday it will examine whether automatic securities disposition plans place “appropriate constraints” […]

20 September 2019

The Business Roundtable on “The Purpose of a Corporation” Back to the future!

In September 2019, CEOs of large U.S. corporations have embraced with suspect enthusiasm the notion that a corporation’s purpose is broader than merely “creating shareholder value”. Why now after 30 years of obedience to the dogma of shareholder primacy and servile (but highly paid) attendance to the whims and wants of investment funds? Simply put, […]

20 September 2019

From Amazon to the Financial Times and Trudeau, the big push is underway to ‘reset’ capitalism

The old pink lady of Fleet Street made history of sorts this week, donning a yellow front page that contained a five-word declaration that it was pursuing a New Agenda. Despite its reputation and self-declared role as a defender of free markets, the Financial Times of London has frequently flirted with assorted compromises. But nothing […]

18 September 2019

U of T’s Anita Anand awarded medal by Royal Society of Canada

Prof. Anita Anand of the University of Toronto’s Faculty of Law has been awarded the Yvan Allaire Medal by the Royal Society of Canada. The medal recognizes an individual’s outstanding contribution in the governance of private and public organisations, a statement from the university said. The RSC, in partnership with the Institute for Governance of Private and […]

23 August 2019

Transat shareholders approve Air Canada takeover, deal now in regulators’ hands

The fate of Air Canada’s $720-million takeover bid for Transat A.T. Inc. rests with regulators after shareholders overwhelmingly approved the acquisition offer Friday. In a special meeting, shareholders of the Quebec-based tour operator voted 94.77 per cent in favour of accepting the $18-per-share transaction from the country’s largest airline. The deal will narrow the field […]

8 August 2019

Transat v. Group Mach: what’s the score?

Mergers and acquisitions are well-choreographed ballets. Both companies call on financial and legal advisers. The board of the target company sets up an independent committee, which promptly retains its own independent legal and financial advisers. Financial advisers produce an opinion letter assuring all and sundry that the price offered is a fair one for the […]

6 August 2019

Damages of the short-term mindset

In March 2014, CEOs of many Fortune 500 corporations received a letter that started with these words: “We are preoccupied… that too many companies have cut capital expenditure and even increased debt to boost dividends and increase share buybacks. We certainly believe that returning cash to shareholders should be part of a balanced capital strategy; however, when […]

31 July 2019

Finding Friends is Hard: Long-Term Investors’ Relationship with Proxy Advisors, Activists and Private Equity Funds

Institutional investors are howling for US public companies to focus more on the long-term.[1]  This is unsurprising. Long-term focused companies produce significantly better results over time, reporting far greater revenue growth with less volatility, far higher levels of economic profit, and greater total return to shareholders.[2] So if you are holding stock for a long time, a […]

18 June 2019

Theory, Evidence, and Policy on Dual-Class Shares: A Country- Specific Response to a Global Debate

Dual-class shares have become one of the most controversial issues in today´s capital markets and corporate governance debates around the world. Namely, it is not clear whether companies should be allowed to go public with dual-class shares and, if so, which restrictions (if any) should be imposed. Three primary regulatory models have been adopted to […]

29 May 2019

Judge rules SNC-Lavalin to stand trial on fraud, bribery charges

A Quebec judge has ruled that SNC-Lavalin Group Inc. can stand trial on bribery and fraud charges, prolonging the Canadian engineering giant’s legal pain and keeping the case in the public eye in the run-up to this fall’s federal election. Justice Claude Leblond of the Quebec Court ruled Wednesday that there is enough evidence to […]