- Great-West Lifeco (TSX:GWO) is sounding a warning bell after its team was notified of an unsolicited mini-tender offer from Ocehan LLC, targeting Canadians
- Ocehan is seeking to purchase up to 50,000 common shares of Lifeco at a price that reflects a 19.70 per cent discount to the closing price of Lifeco’s shares
- Lifeco strongly advises its shareholders against accepting the offer, emphasizing that it is below the current market price for Lifeco shares
- Great-West Lifeco stock (TSX:GWO) last traded at C$49.09
Great-West Lifeco (TSX:GWO) is sounding a warning bell after its team was notified of an unsolicited mini-tender offer from Ocehan LLC, targeting Canadians.
Ocehan is seeking to purchase up to 50,000 common shares of Lifeco at a price that reflects a 19.70 per cent discount to the closing price of Lifeco’s shares on the TSX as of October 24, 2024, the last trading day prior to the offer.
In a news statement, Lifeco made it clear that it does not endorse Ocehan’s unsolicited offer and has no affiliation with the company. The firm strongly advises its shareholders against accepting the offer, emphasizing that it is below the current market price for Lifeco shares.
Mini-tender offers, such as the one proposed by Ocehan, typically seek to acquire less than 5 per cent of a class of outstanding shares, thereby circumventing many investor protections mandated by Canadian law. Regulatory bodies have raised concerns regarding these types of offers, particularly the risk that investors may tender their shares without fully understanding the implications of the offer price compared to the market value of their securities. The U.S. Securities and Exchange Commission has noted that some bidders may use below-market offers to catch investors off guard, highlighting the importance of vigilance in such situations.
In light of this unsolicited offer, Lifeco urges its shareholders to obtain current market quotes for their shares and to consult with their brokers or financial advisors before making any decisions regarding Ocehan’s proposal.
According to the offer documents provided by Ocehan, Lifeco shareholders who have already tendered their shares can withdraw them within 30 days of submitting their tender form, following the procedures outlined in the offer documents. Additionally, Ocehan reserves the right to purchase more than the initial 50,000 shares, up to an additional 2 per cent of the outstanding common shares.
As the situation develops, Lifeco point to the Canadian Securities Administrators’ comments about the risks of mini-tender offers.
Great-West Lifeco Inc. is an international financial services holding company with interests in life insurance, health insurance, retirement and investment services, asset management and reinsurance businesses.
Great-West Lifeco stock (TSX:GWO) last traded at C$49.09 and has risen 11.92 per cent since the beginning of the year.
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