The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.
What a difference a few years makes. Recall the bygone days when there was a fuss about foreigners wanting to buy our miners and oil companies. Sure, Spain’s Repsol played vulture when it scooped up Talisman last month, but it was welcomed rather than turned into a federal case.
The national harrumphing that went on back in 2006 and 2007 when Inco, Falconbridge and Alcan were sold to outsiders is amazing in retrospect. But who would want to be stuck with a fistful of those shares in their portfolios right now, given where commodities are?
Back then, not only commentators, but also Bay Streeters and big shot executives were critical of the CEOs of those companies, railing about how they were selling out Canada’s birthright to rapacious buyers from abroad. Or worse, that they were not willing to step up and pay up to be acquirers rather than sellers.
If only the country had such problems today. The truth is, Inco’s CEO at the time, Scott Hand, and Dick Evans, the CEO of Alcan, got absolutely brilliant prices for their shareholders when they sold their respective companies. Wouldn’t it be something to hear complaints today about selling resource companies at the top of the market?
A few years ago, remember all the whining that went on about CNOOC, one of China’s national oil companies, making a $15-billion bid for Nexen? Even though many oil industry types were dissing Nexen as second rate, the prospect of moneybags arriving from China got a lot of them worried. Looking back, chump may be too harsh a word to describe CNOOC, but good for Nexen shareholders for scoring that one. When the deal was approved, however, the Prime Minister announced new protections applying to state-owned investments in the oil sands.
If you’re holding a bunch of wobbly oil stocks today, maybe you wish the Chinese had been allowed to come in and buy everything in the patch. And not just energy stocks – it might have been nice for Barrick shareholders if three years ago a big sovereign wealth fund had come galumphing into Canada and bid for the gold miner when it was over $50 a share.
For the rest of this column, click here: http://www.theglobeandmail.com/report-on-business/rob-commentary/resource-takeovers-no-cause-for-national-angst/article22426164/