Here are the top reads on deals and financial services over the last week. Have a great weekend,
SNC shares sag amid corruption probe, increasing takeover risk: SNC-Lavalin Group Inc. risks becoming a takeover target if its stock continues to trade at depressed values while its corruption case winds through the courts, analysts say. Canada’s biggest engineering firm said on Wednesday the Public Prosecution Service of Canada has advised it will not at this time invite the company to negotiate a settlement agreement that could have suspended and eventually stayed corruption and fraud charges against the firm. Story (Nicolas Van Praet, for subscribers)
TD sees future for blockchain in banking – but not for bitcoin: Executives at Toronto-Dominion Bank say they’re hopeful about the promises of blockchain technology, but they’re not about to dive headfirst into the world of cryptocurrencies such as bitcoin. TD is interested in how blockchain technology can be used to create digital tokens that represent stocks or bonds or facilitate syndicated loans, Chris Owen, TD’s vice-president of blockchain, said in an interview Wednesday. Story (Alexandra Posadzki, for subscribers)
Two Bank of Montreal executives retiring next year, causing shuffle at upper ranks: Two top executives at the Bank of Montreal are retiring next year, creating an opportunity for chief executive Darryl White to refashion the bank’s upper ranks roughly a year into his tenure. Surjit Rajpal is set to retire in January of 2019, after more than seven years as BMO’s chief risk officer and nearly four decades at the bank. Story (Alexandra Posadzki, for subscribers)
Marlboro maker Altria in talks with Canadian pot grower Aphria: U.S. tobacco giant Altria Group Inc. is in talks to acquire an equity stake in Canadian cannabis grower Aphria Inc., multiple sources say. Details of Altria’s proposed investment in Aphria are still being finalized, said the sources, who asked to remain unnamed because the talks are private. Story (Christina Pellegrini and Marina Strauss, for subscribers)
Securities watchdogs raise red flag over disclosure issues in pot industry: Canada’s securities regulators say the cannabis industry has widespread disclosure problems that are getting in the way of investors’ understanding of how to best invest in pot stocks. Regulators in four provinces reviewed 70 publicly-listed cannabis companies, known as “issuers” in securities-industry lingo, and revealed a laundry list of problems in a Canadian Securities Administrators staff notice Wednesday. Story (David Milstead, for subscribers)
Waste deal: Canadian waste management leader GFL Environmental Inc. is transforming itself into a North American giant by acquiring U.S.-based Waste Industries for $3.65-billion, including debt, capping off a chaotic run for the Toronto-based buyer that included flirting with an initial public offering. Story (Tim Kiladze, for subscribers)
Parkland sails into Caribbean fuel business with $1.57-billion deal: Parkland Fuel Corp. is buying a controlling stake in the Caribbean’s largest independent petroleum distributor for $1.57-billion, extending its fuel-supply reach to the massive U.S. Gulf Coast market. Parkland is acquiring a 75-per-cent interest in Barbados-based SOL Investments Ltd., which distributes and sells fuel in 23 countries under its own brand as well as the Shell and Esso banners. Privately held SOL operates 526 gas stations in the Caribbean. Story (Jeffrey Jones, for subscribers)
Celestica gains slice of growing OLED display market with $330-million deal for U.S. manufacturer: Celestica Inc. will buy Silicon Valley-based light-display equipment maker Impakt Holdings LLC for US$329-million, giving the Toronto-based engineering and manufacturing firm greater presence in South Korea and a slice of the growing “organic” LED light-display market. Announced on Wednesday morning, the acquisition fits into Celestica chief executive Rob Mionis’s previously announced plans to boost operating margins with acquisitions; the company had also announced in January that it would buy the aerospace manufacturing company Atrenne Integrated Solutions Inc. for US$139-million. Story (Josh O’Kane, for subscribers)
Caisse partners with Al Gore’s Generation Investment for private-equity deals: The Caisse de dépôt et placement du Québec struck a US$3-billion alliance with a money manager co-founded by former U.S. vice-president Al Gore, creating a partnership that aims to make investments that can be held as long as 15 years. Story (Andrew Willis, for subscribers)
Canadian clean-tech industry gets boost as venture funds raise capital: A trio of Canadian clean-tech venture funds are attempting to raise $700-million amid calls for more capital to boost the underfunded sector focused on the environment and climate change. Story (Sean Silcoff, for subscribers)
Ottawa announces $25-million in funding for U of T’s Creative Destruction Lab: The Canadian government is providing $25-million to Creative Destruction Lab (CDL), a startup-boosting program based at the University of Toronto created by business professor Ajay Agrawal. The non-profit organization will use the funds to run experiments with startups at five universities that stage its programs across Canada. Story (Sean Silcoff, for subscribers)
MORE FINANCIAL SERVICES AND DEALS NEWS FROM FRIDAY
Scotiabank, CIBC hike posted fixed five-year mortgage rates: Fixed mortgage rates are hitting multiyear highs. But so far, qualifying for a mortgage isn’t getting much harder. For roughly nine in 10 mortgage borrowers, mortgage approval depends on passing the government’s “stress test.” As of this moment, that means applicants must prove they can afford a rate of at least 5.34 per cent (a.k.a. the “mortgage qualifying rate” or “MQR”). Story (Robert McLister)
Earnings season 1: Citigroup Inc. reported a better-than-expected quarterly profit on Friday, helped by lower expenses, higher bond trading revenue and strength in its consumer banking business in Mexico. Story (for subscribers)
Earnings season 2: Wells Fargo & Co posted a 32 per cent jump in quarterly profit on Friday, as the bank gave out more personal and automobile loans, and made headway in its cost-cutting plan. Story (for subscribers)
Earnings season 3: JPMorgan Chase & Co. reported a better-than-expected quarterly profit on Friday as gains from higher interest rates and growth in loans helped the bank offset weakness in bond trading revenue. Story (for subscribers)
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