With a backdrop of only one prior foreign bid rejection under the Investment Canada Act (Canada), further bids by BHP or other foreign acquiring entities required to meet the “net benefit” test under that Act, may prove to be a surmountable challenge, notwithstanding the size of the bid. By way of background, the “net benefit” test really means no net loss of jobs in Canada, as a result of the takeover.
The only prior takeover attempt that was rejected, was in 2008, when Ottawa rejected a takeover of MacDonald Dettweiler by a US entity. This was justified on national security grounds.
The Harper government is, by default, fairly permissive in its perspective on foreign takeovers generally, and foreign ownership in particular (N.B. this was clearly seen in the opening up of the cellular telephone industry in Canada, to a handful of smaller competitors, some of whom were foreign owner or controlled.
Any Sask. Potash takeover, will be illustrative of how Canada intends to apply the Investment Canada Act (Canada) generally.