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Aimia's Largest Shareholder Announces Intention to Launch Takeover Bid for the Company

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Aimia's Largest Shareholder Plans Takeover Bid for the Company

The largest shareholder of Aimia Inc. has announced its intention to make a bid to take the company private. Mithaq Canada Inc., a subsidiary of Mithaq Capital SPC, plans to offer $3.66 per share in cash for the stake in Aimia that it does not already own. This deal would value the company at approximately $308 million. The shareholder has expressed disillusionment and frustration with Aimia's board and management team, citing rejected requests for engagement and a lack of responsiveness to feedback.

Response from Aimia

Aimia, which sold its flagship Aeroplan loyalty program to Air Canada in 2019 and transitioned into an investment holding company, has stated that it will review the proposal with its legal and financial advisors upon receiving a formal offer. Aimia's interim chair, Karen Basian, assured shareholders that the company takes its duty seriously and will rigorously evaluate the proposed offer to maximize value and consider all reasonable stakeholder interests.

Legal Proceedings and Shareholder Dynamics

It is worth noting that Aimia is currently suing Mithaq for breaches of the Securities Act, with a trial scheduled for January 2024. Mithaq, a segregated portfolio company and affiliate of Mithaq Holding Co. based in Saudi Arabia, already holds or exercises control over a 30.96% stake in Aimia. The shareholder had previously voted against the re-election of Aimia's board of directors at the annual meeting. In conclusion, the planned takeover bid by Aimia's largest shareholder highlights the discontent and desire for change within the company. The outcome of this bid and any potential shift in ownership could significantly impact Aimia's future direction and strategies.

Implications of Aimia's Potential Takeover on New Businesses

The planned takeover bid by Aimia Inc.'s largest shareholder, Mithaq Canada Inc., brings to light a significant development that could impact new businesses, particularly those in the investment holding sector. The move signals a growing trend of shareholders seeking more control and influence over company strategies, which could shift the dynamics of corporate governance. For new businesses, this development underscores the importance of maintaining open lines of communication with shareholders. Mithaq's expressed frustration with Aimia's board and management team over rejected engagement requests and unresponsiveness to feedback serves as a cautionary tale. New businesses must prioritize shareholder engagement to avoid similar scenarios. Moreover, the legal proceedings between Aimia and Mithaq highlight the potential for conflicts of interest when shareholders hold significant stakes in a company. This could lead to legal complications that new businesses must be prepared to navigate. Finally, the potential shift in ownership at Aimia could alter the company's future direction and strategies, which could have a ripple effect on the industry. New businesses must stay abreast of these changes and adapt accordingly. In conclusion, while the proposed takeover bid is specific to Aimia, the underlying issues and potential implications are relevant to all new businesses. It's a reminder of the importance of strong shareholder relations, clear legal structures, and adaptability in a changing business landscape.
Story First Published at: https://financialpost.com/pmn/business-pmn/aimias-largest-shareholder-plans-takeover-bid-for-company
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