Fairfax's action on Fibrek - is it fair to the minor shareholders?

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Apparently the Quebec court agrees with Fibrek and Mercer. ABH will appeal and drag this out and enrich the lawyers.

 

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Quebec court overturns warrant cease trade order for Fibrek warrants

By The Canadian Press  | March 09, 2012

 

MONTREAL - The takeover fight for Fibrek Inc. (TSX:FBK) took a turn Friday after the company said a Quebec court has overturned a decision to halt the trading of 32.3 million special warrants issued to Mercer International making a hostile bid more difficult.

 

Vancouver-based Mercer (TSX:MRI.UN) has signed a friendly deal to buy Fibrek, however rival bidder Resolute Forest Products (TSX:ABH) had sought the cease trade order for the special warrants.

 

"We are pleased that the Court of Québec has preserved the fundamental right of all Fibrek shareholders to benefit from the best available offer for their investment in Fibrek," Fibrek chairman Hubert Lacroix said in a statement.

 

"With the special warrants back in place, a level playing field is once again re-established."

 

Fibrek repeated a call to to shareholders to accept the Mercer offer.

 

Resolute, formerly known as AbitibiBowater, is offering $1 per share in a bid that values Fibrek at $130 million, while Mercer has made an offer that values the shares at $1.30 or about $170 million.

 

Under its unsolicited bid, Resolute has entered into lock-up agreements with three big Fibrek shareholders, including Fairfax Financial Holdings Ltd. (TSX:FFH) and Pabrai Investment Funds, which together hold about 46 per cent of Fibrek's shares.

 

Fibrek has approximately 500 employees and operates pulp mills in Saint-Felicien, Que., Fairmont, W.Va. and Menominee, Mich.