Canadian Securities Regulators Reach Consensus On More Target-Friendly Take-Over Bid Legislation

The Canadian Securities Administrators ("CSA") have announced that they intend to publish a new proposal for changes to the regulation of take-over bids, replacing the two alternative proposals published for comment in March 2013. One of the previous proposals was put forward by the entire CSA and addressed shareholder rights plans specifically, while the Quebec Autorité des marchés financiers ("AMF") had presented for consideration a less regulatory framework dealing with take-over defensive tactics generally. The new proposal calls for amendments to the take-over bid legislation which would not change the existing CSA policy on take-over defensive tactics but would alter the rules of the take-over game to address long-standing concerns that the current regulatory regime tilts the playing field too far in favour of hostile bidders, impeding the ability of target boards to exercise their fiduciary duties in defending against bids and pursuing superior alternatives.