ShawCor eliminates dual-class share structure by way of plan of agreement
Date Closed
March 20, 2013
Lead Office
Toronto
Value
564.48 Million CAD
On March 20, 2013, ShawCor Ltd., a TSX-listed issuer with a market capitalization of approximately $2.4 billion, eliminated its dual-class share structure by way of plan of arrangement. Prior to the closing of the transaction, ShawCor’s largest shareholder, Shaw International S.à r.l., a company controlled by Virginia L. Shaw, held Class B multiple voting shares representing approximately 63% of the voting shares, and just under 17% of the equity of ShawCor.
Under the arrangement, ShawCor eliminated its dual class share structure through the purchase of all of ShawCor’s Class A subordinate voting shares and all of ShawCor’s Class B multiple voting shares by a newly formed Canadian corporation, Seaborn Acquisition Inc. Pursuant to the terms of the arrangement, Seaborn acquired all of the Class A shares in exchange for new common shares on a 1:1 basis, and acquired all of the Class B shares in exchange for a mix of new common shares and cash. The consideration paid for the Class B shares was $43.43 in cash or 1.1 new common shares per Class B Share, such that 90% of the total consideration was paid in cash to each shareholder and 10% of the total consideration was paid in new common shares to each shareholder. Upon closing, Seaborn and ShawCor amalgamated under the name “ShawCor Ltd.” As a result of the arrangement, all of the issued and outstanding shares of ShawCor are now the same class of voting common shares.
In connection with the closing of the arrangement, ShawCor also completed a private placement of unsecured senior notes in the aggregate amount of US$350 million, and the amendment and restatement of its existing unsecured revolving credit facility to increase the facility by US$100 million to US$250 million, extend the facility’s term to five years and to reduce the rates of interest payable thereunder.
ShawCor, headquartered in Toronto, Ontario, is a global energy services company specializing in products and services for the pipeline and pipe services, and petrochemical and industrial segments of the oil and gas industry and other industrial markets.
McCarthy Tétrault LLP acted as counsel to Shaw International S.à r.l. in the sale of its controlling interest in ShawCor with a team that was led by Graham Gow.
