Private Placements As A Defence To Take-Over Bids

The Ontario Securities Commission (OSC) and British Columbia Securities Commission (BCSC) recently released a noteworthy decision marking the first instance since changes to the regime governing take-over bids became effective in May 2016 in which Canadian securities regulators considered whether a contemplated private placement is an inappropriate defensive tactic.

The decision In the Matter of Hecla Mining also includes useful guidance concerning the application of the OSC and BCSC's (collectively, the Commissions) public interest jurisdiction in these circumstances.

Background to the dispute

Dolly Varden Silver Corporation is a junior mineral exploration company whose shares are listed on the TSX-V. It is a reporting issuer in BC, Ontario and Alberta.