A Cayman Islands-incorporated gold-mining company, whose principal investor is an Egyptian billionaire, has been notified that Ottawa is considering whether to subject its $1-billion takeover of a Canadian rival to a deeper national-security review.
All foreign takeovers are screened for national-security concerns but in rare instances – fewer than 10 in the previous fiscal year – Ottawa conducts a deeper, more thorough review under Section 25.3 (1) of the Investment Canada Act. These would be cases where the Innovation, Science and Economic Diversification Minister “considers that the investment could be injurious to national security.”
Endeavour Mining Corp., the buyer, whose corporate head office is in London, says it has no idea why Ottawa would be taking a keen interest in its bid to buy Semafo Inc., a Canadian gold-mining company based in Montreal. Both companies’ stocks are listed on the Toronto Stock Exchange.
One of the major investors in Endeavour, however, has previously been rejected in his attempt to buy a Canadian company because of national-security concerns.
Endeavour’s biggest shareholder, Egyptian billionaire Naguib Sawiris, committed to investing an additional $100-million into the company as part of the acquisition of Semafo.
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