VANCOUVER, June 27, 2014 /CNW/ - A British Columbia Securities Commission panel has released the reasons for its decision on May 5, 2014 to make orders in connection with a take-over bid of the shareholder rights plan of Augusta Resource Corporation.
On February 9, 2014, HudBay Minerals Inc. announced its intention to make a bid to acquire all of the issued and outstanding Augusta shares not already owned by HudBay. Prior to this, HudBay had acquired 15% of Augusta's outstanding shares.
On April 18, 2013, the board of directors of Augusta adopted a shareholder rights plan that meant that any further acquisitions of Augusta shares by HudBay would trigger a "poison pill". The shareholder rights plan was ratified and approved by the Augusta shareholders at a special meeting on October 17, 2013.
On April 14, 2014, HudBay applied to the commission for an order cease-trading Augusta's shareholder rights plan. On May 2, 2014, Augusta held another shareholder meeting where the Augusta shareholders voted in favour of continuation of the plan.
On May 2, 2014, the panel made the following orders:
- 'if HudBay extends its take-over bid for the shares of Augusta to expire no earlier than July 16, 2014, and
- if HudBay provides a ten-day extension of its take-over bid if it takes up any shares under the take-over bid, the commission will issue an order cease-trading Augusta's shareholder rights plan, and any securities issued in connection therewith, effective 5:00 pm, Vancouver time, on July 15, 2014, unless Augusta issues and files with the commission a news release by 5:00 pm, Vancouver time, on July 14, 2014, confirming that it has terminated its shareholder rights plan.'
In its reasons, the panel said, that while it would not be in the public interest to make an order cease-trading the (shareholder rights plan) as of May 2, 2014, it was also of the view it would be in the public interest to cease-trade the shareholder rights plan as of July 15, 2014, provided that, HudBay kept the bid open until July 16, 2014 and that it agreed to provide a ten-day extension of the bid if it took up any Augusta Shares.
You may view the decision on our website, www.bcsc.bc.ca, by typing HudBay Minerals Inc., Augusta Resource Corporation, or 2014 BCSECCOM 154 in the search box. Information regarding disciplinary proceedings can be found in the Enforcement section of the BCSC website.
About the British Columbia Securities Commission (www.bcsc.bc.ca)
The British Columbia Securities Commission is the independent provincial government agency responsible for regulating capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and promote the public interest by fostering:
- A securities market that is fair and warrants public confidence
- A dynamic and competitive securities industry that provides investment opportunities and access to capital
SOURCE British Columbia Securities Commission