CANADA LAW AND PRACTICE Contributed by: Kevin West, Andrea Hill, Priya Ratti and Meryam Kellow, SkyLaw
11.3 Interference With Completion In transactional shareholder activism, announced transactions are frequently a target for cam - paigns. In some notable examples, shareholders issued open letters advocating for higher values for their shares and engaged securities regula- tors to address claims of unequal treatment, called on a board to launch strategic reviews of fossil-fuel assets, and requisitioned a share - holder meeting in response to a REIT’s plan to sell off some real estate assets. However, courts may interfere with such activ - ism to help secure the required shareholder vote. Recently, the British Columbia court permitted the option holders of Fission Uranium to exer - cise their options such that they become part of the shareholder vote, thereby overcoming the opposition and approving a plan of arrangement.
In 2024, a significant proportion of shareholder demands focused on M&A and ESG matters. 11.2 Aims of Activists Typically, an activist’s first step is to approach a board confidentially with their demands, with the implicit or explicit threat of a public battle if the requirements are not met. From there, activism can take many forms. Board activism and proxy fights are prominent in Canada, in which shareholders seek to have their nominees put forward for election to the board. In 2024, activists had two high-profile wins, with the replacement of the entire board of both Gildan and Dye & Durham. While shareholder proposals on matters within the board’s purview are only advisory and not binding, they remain important forms of activism as the publicity they attract can create pressure for change. Transactional activists sometimes demand stra- tegic reviews, divestitures, share buy-backs or increased dividends. They might requisition a shareholder meeting, wage a public broadcast campaign in the media or on social media, or launch their own competing tender offer. Some - times the goal is to see an alternative transac- tion implemented; other times, activists try to improve the terms of the original deal.
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