I read the competing bid by Modern Media Holdings Inc's to be more likely to break up the company since the future asset contigency sales is in their deal. I read the Nordstar bid as committing to keep the paper intact.
Isn't the seller within the right to choose which company to sell to based on the way the new buyer will run the business? In this case keeping the business operating and not stripping it was part of the reason why Nordstar was chosen.
I might be misunderstanding but I dont see the egregious action by the owners for their baby to be in the hands of like minded buyers.
Yes, the seller of an asset can sell to whomever he wants. But, in this case, we have a number of management teams involved who are supposed to be acting as fiduciaries for the actual owners (shareholders) of their firm.
The first such management team is Torstar management who should be recommending that its shareholders adopt the objectively most favourable offer, and then holding a shareholder vote to approve or deny the takeover. During that vote, the *actual owners* of TS can make their individual decision of whether they view the offer as desirable. The families can vote against the best financial offer if they want, but to fulfill its fiduciary responsibility, TS should be recommending the better offer and should organize a vote.
The second such management team is FFH management, who should be pursuing the best financial offer on behalf of its shareholders (including those of us in this forum). If the FFH management team is knowingly accepting an inferior financial offer for those TS shares which *we* own, they have some explaining to do. If the decision was actually taken or if it appears to have been taken simply to help their buddy, Paul Rivett, then they really have some explaining to do. I have nothing against Paul Rivett, but I do not at all want any portion of my financial interest in FFH to be expropriated just because he's a nice guy.
In the case of FFH, the company has had recurring governance failures. This looks like it might just be one more abuse of minority (majority!) shareholders.
SJ