Adex Securities Acquires Concord Pacific Group

On December 20, 2002, Adex Securities Inc., completed its insider bid for Vancouver-based Concord Pacific Group Inc. with Adex acquiring, at $3.40 per share, approximately 95 per cent of Concord’s outstanding common shares, including those shares acquired by Adex prior to making the offer. The total transaction value was approximately $95 million. On December 27, 2002, Adex announced that it was exercising its compulsory acquisition rights to acquire the remaining Concord shares not tendered under the offer.

The acquisition was completed by way of a two-tiered bid structure. Under the terms of the offer, Adex offered to acquire: (a) all Concord shares deposited under the offer at $3.40 per share provided that at least 10 million shares were deposited under the offer, or (b) up to a maximum of two million shares on a pro rata basis at $2.75 per share if the number of shares deposited under such alternative was less than 10 million, but not less than two million shares.

The offer was initially mailed to shareholders on November 8, 2002. On December 9, Adex amended the offer to increase the price to be paid from $3.25 to $3.40 per share if at least 10 million shares were deposited under the offer. At the same time, Concord’s board of directors, based on the report of its independent committee and a fairness opinion from its financial advisor, Raymond James Ltd., recommended that shareholders tender their shares to the amended $3.40 alternative.

Adex was represented by McCarthy Tétrault LLP, with a team including Richard Balfour, Joyce Lee, Brian Vick and Darren Watt (securities), Brent Kerr (tax) and Oliver Borgers (competition). Concord was represented by Mitchell Gropper, Q.C., of Farris, Vaughan, Wills & Murphy. The independent committee was represented by Gordon Chambers and Charles Hotel of Lawson Lundell. The offer was financed in part by HSBC Bank Canada, who was represented by Michael Kalef of Koffman Kalef.