July 16, 2019

Streetwise newsletter: Best reads of the week
  Streetwise newsletter: Best reads of the week
Here are the top reads on deals and financial services over the past week,

Technical disasters: The mining industry’s string of spectacular flops: Junior gold-mining executive Scott Caldwell was in a jovial mood as he sat down for a national television interview in February, 2016. Even though the price of gold bullion had tumbled by more than a third from its 2011 peak, and many of his competitors were struggling, his company was defying the odds. Story (Niall McGee)

Allegations against CannTrust are a black eye for the cannabis entire industry: The cannabis industry’s hopes and dreams are predicated on a simple goal: legitimacy. Before Ottawa legalized marijuana and after, pot-sector pioneers took pains to talk about their products as if they were describing natural foods and vitamins. Their message: Canada is becoming a global leader, offering the very finest cannabis to a welcoming public under the highest corporate and regulatory standards. Opinion (Jeffrey Jones)

What CannTrust’s woes mean for other industry players looking to raise capital: CannTrust Holdings Inc. is facing questions over whether it will lose its licence or be forced to destroy thousands of kilograms of cannabis amid a Health Canada investigation that has sent the company’s stock plummeting and led to sales of its product being halted in two provinces. Story (Mark Rendell)

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U.S. software firm Aspen Technology buys Montreal startup Mnubo for $102-million: U.S. software firm Aspen Technology Inc. has bought Montreal internet-of-things startup Mnubo Inc. for $102-million and will build a global artificial-intelligence hub in the city around the purchased company’s 60-odd employees. The acquisition was one of two announced Friday by Aspen, a publicly traded provider of asset-optimization software based in Bedford, Mass., that generated US$148-million in its fiscal third quarter and US$61.6-million in net income. Aspen also bought U.K.-based software firm Sabisu Ltd. for an undisclosed amount. Story (Sean Silcoff)

‘I have never seen this’: Aimia shareholders call for new meeting after ‘outrageous conduct’: A group of shareholders at Aimia Inc. are calling for a redo of last month’s annual general meeting, which they say was “plagued with irregularities” and “outrageous conduct.” Story (The Canadian Press)

‘It’s been a disastrous investment:’ Shareholders of Montreal’s Velan call for sale amid sliding results, ongoing family feud: A group of discontented shareholders is urging Velan Inc. to put itself up for sale amid disappointing financial results and discord among the family members who control the company. “It’s been a disastrous investment,” said Stephen Takacsy, president and chief executive officer of Lester Asset Management in Montreal. Mr. Takacsy is part of a group of six institutional investors that own approximately 16 per cent of Velan’s total equity and is pushing the board of directors to launch a strategic review, as the company prepares for its annual meeting on Thursday. The group is also open to a privatization. “The company should never have gone public,” Mr. Takacsy said. Story (Joe Castaldo)

HBC hires advisers to help in review of privatization bid: Hudson’s Bay Co.’s special board committee has hired advisers to help evaluate a $1-billion take-private bid by the retailer’s executive chairman, and it pledged to consider criticism from minority shareholders. Story (Jeffrey Jones)

GMP’s Fricker to get $1-million bonus as he steps down: GMP Capital Inc.’s CEO Harris Fricker will receive a $1-million bonus – in addition to his multimillion-dollar severance – as he steps down next month, passing the reins over to Kishore Kapoor, a director at GMP. Story (Clare O’Hara)

Teachers names Jo Taylor new CEO; Ron Mock to retire: Ontario Teachers’ Pension Plan said its head of international investing will become its next leader when chief executive officer Ron Mock retires next year. Jo Taylor, currently Teachers’ executive managing director, global development, will become CEO on Jan. 1, the pension plan said Tuesday. Story (David Milstead)

CIBC expands U.S. footprint with deal to buy boutique investment bank Cleary Gull: Canadian Imperial Bank of Commerce is adding to its expanded U.S. footprint by acquiring Cleary Gull, a boutique investment banking company based in Milwaukee. The deal, announced Tuesday morning, bolsters CIBC’s capacity to serve the middle market – privately owned companies that are the bread and butter of its U.S. commercial banking business – particularly in the U.S. Midwest. Story (James Bradshaw)

Acacia pushes Barrick to bump up takeover offer: Barrick Gold Corp. has been given more time to table a formal takeover bid for Acacia Mining PLC, as its London-based subsidiary pushes for a materially higher offer. Story (Niall McGee)

CIBC to launch exchange-traded bonds: CIBC World Markets says a new type of bond has opened up the debt markets to mid-sized companies seeking to issue debt without diluting existing shareholders’ stakes. Story (Alexandra Posadzki)

OSFI reprimanded Scotiabank for unsatisfactory record-keeping in Puerto Rican operations: Canada’s banking regulator reprimanded Bank of Nova Scotia for inadequate record-keeping in its Puerto Rican operations, years before this country’s third-biggest bank decided to sell its 109-year-old subsidiary at a loss. The Office of the Superintendent of Financial Institutions (OSFI) visited Scotiabank de Puerto Rico, the oldest foreign bank in the U.S. territory, to audit its commercial credit files in 2014, according to two people familiar with the matter. Story (Rita Trichur)

Why Murray Edwards keeps investing in Alberta’s oil sands: In one of the great contrarian investments of our time, billionaires such as Murray Edwards and Li Ka-Shing are pouring money into Alberta’s oil sands. While foreign energy companies were selling their oil-sands holdings and investors were purging domestic energy stocks from their portfolios, Mr. Edwards’s Canadian Natural Resources Ltd. (CNRL) and Li family-controlled Husky Energy Inc. have increased their stakes in the region. As part of a massive shift in ownership that has seen more than $37-billion of oil-sands assets change hands, CNRL dropped $16.5-billion to acquire properties from Devon Energy Corp. and Shell Canada Ltd., while Husky spent US$435-million on a heavy oil refinery last summer. Opinion (Andrew Willis)

Bidder on 407 says its case will hinge on expansion of pension fund operations: One bidder in the court battle over SNC-Lavalin Group Inc.’s stake up for sale in Ontario’s Highway 407 toll road says the increasingly active role of pension funds in infrastructure projects has put them in direct competition with construction and engineering firms. Story (Alexandra Posadzki and David Milstead)

Carolyn Rogers aims to leave mark on global financial system as first Canadian head of Basel Committee: When Carolyn Rogers joined Canada’s banking regulator in the fall of 2016, she was thrust into the final stages of an international effort to change the rules for banks. The Basel III accord – a package of standards that forced banks to carry more capital and limit the risks they take – began as a response to the global financial crisis of 2008. It took years of negotiations to complete, and now Ms. Rogers is getting another chance to put her stamp on that project. Story (James Bradshaw)


Watchdog for New Brunswick investors issues warning for two unregistered companies: New Brunswick’s Financial and Consumer Services Commission says Blue Sail Trading is targeting New Brunswickers to invest specifically in foreign exchange, while HB Global is seeking investments in the derivatives market. Story (The Canadian Press)

AB InBev Asia cancels world’s largest IPO of 2019: Anheuser-Busch InBev said on Friday it will not proceed with the initial public offering of its Asia Pacific unit, Budweiser Brewing Company APAC Ltd., on the Hong Kong Stock Exchange. It had been set to be world’s biggest listing of 2019. The company had been seeking to raise up to US$9.8-billion. Story (Reuters)

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