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Year in Review 2017: Biggest Canadian business deals of 2017

As 2017 circles the drain, the North American Free Trade Agreement (NAFTA) negotiations continue to get drawn out. U.S. demands for the negotiation — and threats to end it if they aren’t met — have proven a hurdle for the talks, and more negotiations are planned for the first quarter of 2018.

(Giphy)

Seemingly in preparation for the deal with the south to go south, the big trend in business deals this year was American companies buying up Canadian ones, or merging to make massive North American conglomerates.

Here’s a look at the biggest Canadian business deals of 2017, plus a couple of honourable mentions for good measure.

(The Canadian Press)

Brookfield buys Sheraton Hotel

While relatively low in comparative dollar value, when measured against other deals on this list, the sale of the Sheraton Hotel in Toronto, Ont. is still worth noting. Its acquisition by an arm of Toronto-based Brookfield Asset Management is the largest ever transaction for a hotel in Canadian history, ringing in at $335 million. Brookfield’s hospitality properties are primarily in the U.S., and this marks

(Netflix)

Netflix makes big investment in Canadian media scene

As part of a massive revamp of Canada’s cultural policy, it was announced in September that streaming giant Netflix would invest $500 million in Canadian television and film production over the next five years. The company bucked criticism that it had managed to score a tax deal from the government, or that it was circumventing CanCon broadcast rules in the country (it’s a streaming service, not a broadcaster, so Canadian Content requirements don’t apply). Now, the company is waiting to make announcements about what it’s first made in Canada productions since the deal will be.

(The Canadian Press)

CGI acquires Affecto

Not all of this year’s deals were limited to Canada and the U.S. One of 2017’s major deals came from Montreal-based CGI Group Inc. acquiring Affecto PLC. CGI offered $146 million in cash for the company, which would add about 1,000 employees in Northern Europe to CGI’s global staff of 7,000. Affecto specializes in providing business intelligence and enterprise management solutions and services.

(Reuters)

Couche-Tard acquires Holiday Stationstores

The Laval, Que.-based Alimentation Couche-Tard Inc. expanded its network further in 2017 with its acquisition of Holiday Stationstores, a U.S. chain of gas stations and convenience stores. Couche-Tard was already one of the largest convenience store chains in the world, owning the Circle K brand and operating more than 12,000 stores globally. Holiday Stationstores adds another 522 stores to their roster for an undisclosed sum. While the rest of Couche-Tard’s convenience stores outside of Quebec operate under the Circle K banner, the company opted to keep the Holiday Stationstores brand due to widespread recognition in the northern U.S. where it operates.

(Reuters)

Enbridge and Spectra Energy merge

This merger in early fall created the largest energy infrastructure company in North America. Now operating under the Enbridge name, the company is valued at about $165 billion. Following the takeover, Enbridge announced in November that it would be selling about $3 billion in assets, and increasing its dividends by 10 per cent, a sign that strong profitability is in the cards as they consolidate post-merger.

 

(Canadian Press)

CCCI acquisition of Aecon

A unit of China Communications Construction Co., CCCC International Holding Ltd. (CCCI) made a massive bid for Canadian construction firm Aecon Group Inc. in October. So massive, in fact, that it was subject government review before the $1.5 billion bid for Aecon could be approved. China’s ambassador to Canada said no such review would be necessary because the technology from the Chinese side was much more advanced than Canada’s, therefore there was no threat of having technology stolen. The deal between China and Canada could be coming at a great time, argues former Conservative MP Stockwell Day, who suggests it’s a great step towards Chinese trade in light of NAFTA negotiations going less that optimally.

(Evening Standard)

Vista Equity Partner buys DH Corp

The Toronto-based DH Corp was snapped up by U.S. private equity firm Vista Equity Partners for a cool $4.8 billion. The deal was first announced in March. Since then, the fintech company had been combined with Vista’s previously owned U.K. financial-based software acquisition Misys to create Finastra. The U.K.-based Finastra has kept a large employe base in Canada, with about 1,800 people, and about 20 per cent of Finastra’s overall revenue comes from Canada, too. The now six-month-old Finastra is the third-largest fintech firm in the world.

(The Canadian Press)

Hydro One buys Avista

In a blockbuster Canadian deal, Ontario-based Hydro One acquired Avista to become the largest regulated utility company in North America. Hydro One paid $6.7 billion to purchase Avista shares, creating a company with an enterprise value worth $31.2 billion. While Hydro One’s CEO Mayo Schmidt made a point of telling shareholders that electricity rates wouldn’t be going up as a result of the deal in July, it did request a rate increase in November for some customers to offset the cost of keeping the existing power system stable, unrelated to the acquisition.

Honourable mentions:

(Motley Fool Canada)

Aurora makes bid for CanniMed

Vancouver-based Aurora Cannabis Inc. stirred up the medical marijuana industry with its bid for CanniMed Theraputics Inc. What started as a friendly offer for a merger (which was summarily rejected by CanniMed) turned into a hostile takeover attempt for $582 million, taken directly to shareholders. What makes the deal even more controversial was how closely it followed news that Cannimed had acquired Newstrike Resources Ltd. for about $248 million. The aggressive move sat well with investors, though: Aurora’s stock has seen 250 per cent growth this year, the strongest performing marijuana stock of the year so far.

(Food & Wine)

Restaurant Brands buys Popeyes

Special mention needs to go to the acquisition of Popeyes by Restaurant Brands International. While neither is a Canadian brand, per se, the owner of Tim Hortons has a strong presence in Canada, where it also operates Burger King. The US$1.8 billion deal added yet another quick-serve restaurant to the RBI portfolio, which operates over 23,000 restaurants in more than 100 countries.

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