Cineplex has agreed to be acquired by London-based Cineworld Group in an all-cash deal worth $34 per share. It’s a significant premium to Friday’s closing price, but a multi-year chart reveals a discount to where Canada’s largest theatre operator was trading just over a year ago. Basic question today is whether the price is right for longer-term holders of Cineplex. We’ll also consider the potential for a better offer to surface during Cineplex’s seven-week go-shop period. And then there’s the issue of potential competition concerns, seeing as how Cineworld is already an industry giant.
HBC SHAREHOLDER VOTE DELAYED
The special meeting that had been scheduled for tomorrow wherein HBC investors would have their say on the proposed privatization led by Executive Chairman Richard Baker has been postponed as a result of the challenge mounted by rival bidder Catalyst Group. While Catalyst failed to convince the Ontario Securities Commission to block the deal outright, it did compel the regulator to order updated disclosures from the Baker group. Our Bloomberg partners, meanwhile, are reporting Baker’s group is considering abandoning its offer.
FISCAL UPDATE
Finance Minister Bill Morneau will update Canadians on the state of the country’s economy and fiscal outlook this morning. Under ordinary circumstances, it’s a hotly anticipated event. But coming so soon after an election campaign where the federal Liberals showed their hand on policy and a projected $27-billion deficit in 2020-21, it will be interesting to see if the finance minister has any news up his sleeve for today’s event.
BEBAWI FOUND GUILTY
Former SNC-Lavalin Executive Vice-President Sami Bebawi was found guilty yesterday on all five charges in his trial on corruption-related charges stemming from decades-old dealings to secure contracts in Libya. We’ll look into questions this raises about implications for the looming criminal trial of SNC itself.
OTHER NOTABLE STORIES
-Equinox Gold is buying Frank Giustra’s Leagold Mining in an all-stock no-premium transaction.
-Shares of Boeing are under pressure in pre-market trading amid multiple reports the company is considering suspending production of its 737 Max jet due to uncertainty about when it will be cleared to fly again.
-Hexo today said it will not have to destroy the cannabis inventory that had been put on hold as a result of unlicensed production at its Niagara, Ont. facility.
-China’s economy delivered some upside surprises overnight with November retail sales and industrial production accelerating above and beyond expectations.
NOTABLE RELEASES/EVENTS
-Notable earnings: Hexo
-Notable data: Canadian international securities transactions, Canadian existing home sales, China retail sales and industrial production
-10:30 a.m. ET: Toronto Police to release statement from Sherman family regarding investigation into murders of Barry and Honey Sherman
-10:45 a.m. ET: Finance Minister Bill Morneau delivers fiscal update news conference in Ottawa
-12:00 p.m. ET: Alberta Court of Appeal begins hearing province's reference case on constitutionality of federal carbon tax
-12:30 p.m. ET: Federal Court of Appeal hears arguments from First Nations on Trans Mountain expansion consultations
-Statistics Canada releases study "Measuring the gig economy in Canada using administrative data"
Every morning BNN Bloomberg's Managing Editor Noah Zivitz writes a ‘chase note’ to BNN Bloomberg's editorial staff listing the stories and events that will be in the spotlight that day. Have it delivered to your inbox before the trading day begins by heading to www.bnnbloomberg.ca/subscribe.
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