Hello and welcome back to Top Five Friday Finds – the weekly series in which we share five of the business news stories that dominated the papers (and our conversations) this week.
Last week, we let you know that CanniMed had filed a lawsuit against Aurora Cannibis alleging ‘multiple claims of wrongdoing’. To recap – Aurora had launched a hostile takeover bid for CanniMed back in November, and CanniMed was convinced that Aurora had conspired to hurt their company to secure a lower price. Well, it looks like the dueling cannabis companies have buried the hatchet. On Wednesday the two companies announced a new friendly deal, which will see Aurora buy CanniMed for $1.1 billion. The deal is the largest marijuana transaction in Canada, and will result in the creation of the country’s largest marijuana producer by market capitalization. This closes the first chapter of the CanniMed/Aurora saga, however marijuana takeovers will likely remain in the news. Experts expect to see more consolidation within the year, as Canada continues its march toward legalization.
Speaking of takeovers, early this week Cara Operations Ltd – the parent company of beloved Canadian brands including Harvey’s, Milestones and (my personal favourite) Swiss Chalet – announced its intent to fold Keg Restaurants into its restaurant portfolio. The deal, valued at $200 million in cash and shares, is said to be mutually beneficial. Cara will benefit from the Keg’s upscale brand image, while the Keg can leverage Cara’s substantial purse and continue expanding south of the border.
Some watch the Super Bowl for the sports, some watch the Super Bowl for the snacks, and some, at least in the United States, watch it for the ads. The Super Bowl airs Sunday February 4th, and Bell Canada and the National Football League are fighting to prevent Canadian viewers from see the event in its full glory. Last year, for the first time in 40 years, Canadian viewers were able to see American commercials during the broadcast due to the removal of a ban implemented by the Canadian Radio-television and Telecommunications Commission (CRTC). The ban, which prohibits the simultaneous substitution of Canadian ads over American broadcasts, granted Canadian viewers the opportunity to view American commercials, but at a cost to Canadian broadcasters. Typically, Canadian rights holders for major TV events take the US feed and splice Canadian advertisements during the commercial breaks. This allows the broadcaster to turn a profit off of the event. By allowing unaltered American broadcasts to air in Canada, the CRTC is deterring advertisers from placing ads during the broadcast – and Canadian telecom companies are taking a hit. Last year Bell saw a drop in advertising revenue of $11 million during the football game. It is this drop that sparked its decision to appeal for a reversal of the ban. The appeal was submitted to the Supreme Court of Canada on January 2, and with the Super Bowl just days away, it is unclear which commercials Canadians will be viewing on game day.
Campell’s Soup might be a pantry staple but, as of Wednesday, it looks like it will no longer be a GTA staple. This week Campbell Soup Company announced their decision to shut down the company’s Etobicoke manufacturing facility. Closing the 87-year old plant will impact an estimated 380 jobs, as operations are shifted from Toronto to the company’s North Carolina, Ohio and Texas facilities.
And finally, the battle between Boeing Co. and Bombardier Inc. will come to a head this week when the International Trade Commission (ITC) releases its decision on the companies long running trade dispute. To recap, last April Boeing accused Bombardier of dumping planes in the U.S. market, and requested that a 292.21% duty be applied to Bombardier imports moving forward. Trade lawyers and industry experts predict that the ITC will back Boeing, however it’s unlikely the Canadian manufacturer will take the ruling lying down. The company’s various social media accounts continue to speak out against Boeing, and the company is expected to launch an appeal in the wake of an unfavourable ruling.