January 18, 2006
Torys ranked in the top ten firms globally on Canadian M&A deals in 2005, according to Thomson Financial. The firm advised on 44 mergers and acquisitions totalling US$19.6 billion.
The current boom in M&A activity--up 53 percent from 2004--shows no sign of abating. It is being fuelled by the combination of a global explosion in rich corporate shoppers and a proliferation of assertive shareholders who are either pushing corporate laggards into play or holding up deals for higher prices.
These two powerful forces have triggered an unprecedented wave of hostile bids, particularly by equity funds, which have been given trillions of dollars by pension funds and other investors who are seeking higher returns than the stock market can offer.
Hostile bids are putting enormous pressure on directors and advisers to make snap decisions about deals and alternative strategies. These complexities, coupled with new laws, are changing conventional legal wisdom about corporate disclosure, defence tactics and deal structures.