Beware the merge

Months after US-based Pfizer pharmaceuticals promised that its country’s politicians would not sink a merger with Irish drug firm Allergan, US politicians scuppered the deal in April. Here are some proposed Canadian mergers suffering the same fate.

2: Mega bank mergers squelched in 1998 by federal Finance Minister Paul Martin, who announces that the marriages of RBC and BMO and TD and CIBC are not “in the best interests of Canadians.” Royal Bank CEO John Cleghorn says the greater scale is needed to stop “dicking around on the beach.”

3: Number of sticking points, including head-office location and governance roles, leading to the collapse of a signed US$33-billion merger between Toronto-based Barrick Gold and US-based Newmont Mining Corp. in 2014. Later, Barrick says Newmont is “not shareholder friendly,” while Newmont calls Barrick’s co-chairman unprofessional.

8: Months in 1991 that Canada Packers Inc. and John Labbatt Ltd. spend trying to convince Canada’s competition bureau the announced merger of their flour and bakery business is good for Canadians. The firms reject the bureau’s proposal that they sell flour mills to other buyers to facilitate the deal.

10: Millions of dollars in fees the TMX Group owes the London Stock Exchange following a failed marriage in 2011. The $3.7-billion merger would have included head offices in Toronto and London, but fears that Canada will lose control of the Toronto exchange factor into the collapse.

62.5: Market value in billions of dollars for a proposed 2014 merger between Calgary-based Canadian Pacific Railway Ltd. and US railroad CSX Corp. After CSX balked at the union, CPR tried to partner with Norfolk Southern Corp. of Virginia. Opposition sunk that merger this past April.

2009: Year a friendly merger between Canada’s Hudbay Minerals Inc. and Lundin Mining Corp. fails after Hudbay admits its own shareholders will vote down the deal. The merger would have created one of Canada’s largest publicly traded base-metal firms.

23,000:
Kilometres of rail associated with discussions to merge the eastern and central operations of Canadian National and Canadian Pacific railways in 1994. When talks break down after six months, CN Rail president and CEO Paul Tellier notes, “History will say they made a very great mistake.”

About the Author

Steve Brearton


Steve Brearton is a freelance writer in Toronto.

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