2014-15 Canada-China Business Forum Magazine - Page 58

LAW 法律 • A buyer who puts forward a successful, accepted bid can be confident that the court should approve the bid which has been recommended by its officer. That is, buyers can have confidence in putting their best offer forward because they know that if their best offer is accepted, it should be approved by the court and that the transaction will close – and other, competing buyers will not disrupt the sale or get a second attempt. Having said that, it can be acknowledged that one of the strengths of the Canadian system is that it has been flexible and has imported some procedures from other jurisdictions. In that regard, some Canadian cases have incorporated a form of stalking horse sales process, which is more of an American concept, in which the court will approve an initial offer to purchase on the basis that there will be a time-limited opportunity for competing, qualified bidders to seek to top that initial offer in a controlled auction process. In those situations, the original bidder will receive a specified break fee if its offer is ultimately topped. A stalking horse process can give a buyer an enhanced level of control and exclusivity as well as an opportunity to recover its professional costs if a superior offer ultimately emerges. However, in short, in any of these procedures, it is essential for an interested bidder to know how the process works and what a judge will or will not approve in any given situation. This allows the bidder to avoid asking for things that are unattainable )