ShawCor Completes Arrangement to Eliminate Dual-class Structure

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 on March 20, 2013. Prior to the closing of the transaction, ShawCor's largest shareholder Shaw International S.à r.l. a company controlled by Virginia Shaw, held Class B multiple voting shares representing approximately 63 per cent of the voting shares and just under 17 per cent 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 per cent of the total consideration was paid in cash to each shareholder and 10 per cent 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 was represented in-house by Darrell Ewert, Corporate Secretary, with assistance from a team at Stikeman Elliott LLP led by Simon Romano that included Sean Vanderpol, Steven Bennett and Nasim Jamasbi (mergers & acquisitions); John Lorito and Lindsay Gwyer (tax); Eliot Kolers and Ellen Snow (litigation) and Paul Collins and Mike Kilby (competition).

McMillan LLP represented ShawCor in connection with the private placement of unsecured senior notes and the amendment and restatement of its existing credit facility, with a team led by Eric Friedman that included Bill Sheridan and Paul Collins (securities) and Ken Bursey and Maria Sagan(financial services). Andrews Kurth LLP represented ShawCor in the US on the financings with a team led by Wes Dorman that included Jason Peters (banking) and Rob Taylor (corporate finance).

Chapman and Cutler LLP represented the investors in connection with the private placement of unsecured senior notes, with a team led by Neil Mann that included Alyson Miller and Charles Calloway (corporate finance).

Fasken Martineau DuMoulin LLP represented ShawCor's banking syndicate, which includes The Toronto-Dominion Bank and HSBC Bank USA, National Association as agents, with a team led by Jon Holmstrom that included David Johnson and Dev Singh (financial services).

McCarthy Tétrault LLP and Withers LLP acted as Canadian and international counsel, respectively, to Shaw International S.à r.l., the former controlling shareholder of ShawCor, in connection with the arrangement. The McCarthy Tétrault team was led by Graham Gow and Ian Michael and included Daniel Saposnik (mergers and acquisitions); Gabrielle Richards (tax) and Geoff Hall (litigation). The Withers team was made up of Robert Wessely (mergers and acquisitions); Samantha Morgan (international tax) and David Guin (securities).

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