The board of directors of Matco Ravary Inc., after taking advice from an independent committee of its board and financial advisors, had approved the sale of all the operating assets of Matco to a competitor, Groupe BMR Inc. This decision was not to be submitted for approval to the shareholders of Matco. Rona is a 30 per cent shareholder of Matco and had one representative on the board of directors of Matco (the latter had abstained from voting on the approval of the sale). Groupe BMR and Rona are also competitors in the Quebec market, with Rona being the biggest of the two. Rona instituted injunction proceedings to prevent the closing of the sale scheduled for January 30, 2003, alleging that such sale required the approval of 2/3 of the shareholders of Matco. Rona attempted to characterize the sale of assets to a liquidation situation and subject to the Winding up Act, which requires such approval.
The Companies Act (Québec) grants companies the same rights as those of a natural person like the Canada Business Corporations Ac (CBCA) and other provincial equivalents. However, while the CBCA and similar legislation require specific shareholder approval on the sale of assets, the Companies Act (Québec) does not. Tee rules of the TSX do not require such approval either in this case.
Matco was represented by Gowling Lafleur Henderson LLP, with a corporate commercial and litigation group in Montreal that included Robert Dorion, Julie-Martine Loranger, Martine Guimond, Leonard Serafini, Alexandre Sami and Rafal Wrzesien. The principal shareholders of Matco were represented by Stikeman Elliott LLP in Montreal.
The Companies Act (Québec) grants companies the same rights as those of a natural person like the Canada Business Corporations Ac (CBCA) and other provincial equivalents. However, while the CBCA and similar legislation require specific shareholder approval on the sale of assets, the Companies Act (Québec) does not. Tee rules of the TSX do not require such approval either in this case.
Matco was represented by Gowling Lafleur Henderson LLP, with a corporate commercial and litigation group in Montreal that included Robert Dorion, Julie-Martine Loranger, Martine Guimond, Leonard Serafini, Alexandre Sami and Rafal Wrzesien. The principal shareholders of Matco were represented by Stikeman Elliott LLP in Montreal.
