McMillan Advises on Alpha Lithium Corporation’s Takeover Bid by Tecpetrol Investments S.L.

On October 22, 2023, Tecpetrol Investments S.L. (“Tecpetrol”), a member of the Techint Group, acquired control over Alpha Lithium Corporation (“Alpha”) in an unsolicited takeover bid. The parties, together with their advisors, undertook significant negotiations which resulted in the price being increased from $1.24 to $1.48 per share.

Alpha’s Board and Special Committee initially recommended that shareholders reject Tecpetrol’s offer because, among other reasons, Alpha had been engaged in a sale process for its Tolillar Project which was subsequently expanded to include a potential corporate-level sale of Alpha. In arriving at their recommendation, the Board and Special Committee received extensive advice from their respective legal and financial advisors including legal advice in respect of their duties to Alpha and an inadequacy opinion from PI Financial Corp.

Following the increased offer price, Alpha’s Board and Special Committee recommended that shareholders tender their shares to the bid. There was a lack of a binding offer from the sales process and no expectation of an alternative transaction prior to the expiry of the offer. The parties also entered into an agreement to complete a subsequent acquisition transaction to allow Tecpetrol to acquire the remaining outstanding shares.

McMillan acted as counsel to the Special Committee of the Board of Directors of Alpha in connection with this cross-border matter. The team, led by Paul Davis and included Sandra Zhao, Arjin Choi, Ouvedi Rama Naiken, William Wu, Samantha Gordon and Michael Friedman, supported one of the few unsolicited takeover bids successfully completed in Canada since the amendments to the takeover bid regime in 2016. The transaction drew upon the expertise of McMillan’s lawyers in several areas, including M&A, Securities, Competition and Investment Canada, Tax and Employment.

As a national business law firm with exceptional capabilities to lead businesses through cross-border transactions and investments into Canada and within multifaceted regulatory regimes, McMillan provides real-time business solutions to our clients. Our Capital Markets & Securities Group is skilled at structuring and closing complex deals of all shapes and sizes in Canada, the US and internationally and in providing innovative transactional advice and solutions. Our understanding of business imperatives and our relationships with the regulators helps our clients stay ahead.