Aus Stockhouse:
Industry Canada halts takeover of Forsys Peter Koven, Financial Post Published: Tuesday, August 18, 2009
Handout photo The long-awaited, $579-million takeover of Forsys by George Forrest International Afrique (GFI) was supposed to close early this week. But to the surprise of very few people, GFI said it needs more ... TORONTO -- Industry Canada has halted the takeover of Forsys Metals Corp. until it obtains more information from the proposed buyer, yet another dramatic twist
in a saga that has lasted for nearly a year.
Industry Canada sent a letter to George Forrest International Afrique (GFI) saying the company is forbidden from completing its $579-million acquisition of Forsys "pending further notice" from the government.
Bruce Hall, chief communications officer of Forsys, said the government is doing a routine background check of GFI, and this should not prevent the deal from closing.
"They're just asking a couple of questions to check about things like money laundering or terrorism. GFI should be able to answer them easily," he said.
But the news prompted a panic among investors. Forsys shares were down 17% at $5.13 in mid-afternoon trading, well below GFI's takeout price of $7.00 a share. The stock was halted all morning.
GFI, a private and very secretive company led by entrepreneur George Forrest, agreed to buy Forsys last November. But it then ran into problems securing financing. As a result, the deal was delayed for months. It was expected to finally close this week or early next week before Industry Canada intervened. |