The C$1.1bn (£700m) management buyout of Canaccord Genuity Group has fallen through after the 13 June deadline passed without a resolution to the regulatory issue that was holding back deal.
In a statement released on the Toronto Stock Exchange today (14 June), the company said certain key conditions to the offer had not been met, including those related to the receipt of “certain regulatory approvals”. The company warned last month a regulatory snag – details of which have not been revealed – involving one of the company’s subsidiaries meant the deal may not be approved.
More recently the board recommended shareholders reject the offer, also flagging concerns the conditions were unlikely to be satisfied by the expiry date.
Today’s statement said the takeover group, which is headed by CEO and president Daniel Daviau and includes chair David Kassie, have decided not to extend the offer, and it has been terminated.
Canaccord has subsequently entered into an agreement with the management group which allows them to consider “potential value enhancing alternative transactions that may be available to the company”.
Michael Auerbach, chair of the special committee, said: “I would like to thank my fellow committee members, Terry Lyons, Amy Freedman and Rod Phillips, for their hard work and valued efforts over the past couple of months in responding to the offer.
“As independent directors, we look forward to ensuring strong governance while continuing to work constructively with management in our efforts to enhance and unlock value for all shareholders.”
Shares in the company fell 3% in the first five minutes of trading.
