In a presentation released Thursday, Catalyst Capital Group Inc. said that Corus could increase the value of its minority shares by between 23 and 107 per cent, or up to $10.50 a share, if it decided to renegotiate the terms of its proposed $2.65-billion transaction, which is for $1.85 billion in cash and $800 million in stock.
That’s a rather interesting turn of events, as Catalyst initially claimed Corus was paying $200 million more than it should be. Since then, Catalyst’s calculation has gone up and up: In an earlier presentation dated February 16, Catalyst said Corus had overpaid Corus by $600 million. Fast forward to today, and Catalyst now claims Corus overpaid Shaw Media by $858 million.
Corus initially disputed Catalyst’s calculations, saying they appeared to be based on flawed and ill-informed assumptions that are simply not credible.
When questioned by the Financial Times, Sally Tindal said the Shaw Media deal was using special committees, adding that two separate fairness opinions were considered. Both deemed the purchase price of $2.65 billion to be fair.
Catalyst, on the other hand, has a different opinion about the deal:
“While this may be a good deal for the Shaw family, it is a bad deal for every Corus minority shareholder,” said Gabriel de Alba, Catalyst’s managing director and partner. “Catalyst has asked Corus simple questions on behalf of all shareholders, only to be met with secrecy and a steady stream of misleading information.”
De Alba also pointed to the speed Corus is trying to push this deal through as a cause for concern and is asking Corus to reschedule the special March 9 meeting and publish a revised circular containing “full and clear disclosure of all material facts that have not been provided in the current circular so they can make an informed decision.”