The Auction Process In M&A

In the context of M&A transactions, an auction is a process by which multiple buyers simultaneously bid to acquire a target. The term "controlled auction" refers to an auction where there is a carefully sequenced and monitored process involving a selected group of buyers. The main goal of a controlled auction is to realize the best possible price for the target and the most favourable transaction terms for the seller. Unlike in the United States, Canadian law does not require the board of directors of a seller to focus on maximizing shareholder value in a change of control transaction. Instead, Canadian law gives the board of directors of a seller the ability to consider a wider range of factors including taking into account the interests of creditors and employees.