Winnipeg-based Great-West Lifeco (Lifeco) has warned Irish investors against a mini-tender offer by Okello Ltd., saying it has not authorized the company to sell its shares.
In a statement, Lifeco said that they have been notified of an unsolicited mini-tender offer made to residents of Ireland to purchase up to 50,000 common shares of Lifeco. The offer represents a discount of approximately 39% to the closing price of the common shares on the TSX on July 29, 2024, the last trading day before the offer was commenced.
Lifeco also clarified that the common shares do not trade on a recognized stock exchange in Ireland.
“Lifeco does not endorse Okello's unsolicited offer, has no association with Okello or its offer, and does not recommend acceptance of the offer. Okello's offer has been made below the current market price for the shares,” the company explained.
According to Lifeco, mini-tender offers such as Okello's seek less than 5% of a class of outstanding shares and so avoid many of the investor protections like disclosure and procedural protections applicable to most bids under Canadian law.
Lifeco also said securities regulators have already expressed “serious” concerns over mini-tender offers, including the possibility that investors might tender to such offers without understanding the offer price relative to the actual market price of their securities.
Citing the US Securities and Exchange Commission, Lifeco said this method is used by bidders in the hope “they will catch investors off guard,” especially if the investors did not do the due diligence of comparing the offer price to the current market price.
Lifeco urged its shareholders to acquire current market quotes for their shares and to consult with their broker or financial advisor in considering Okello's offer.
“According to Okello's offer documents, shareholder tenders are irrevocable and cannot be withdrawn once lodged. Further, tendering shareholders do not have the option to tender only a portion of their shares,” Lifeco said.
“Okello has reserved the right to purchase an additional number of shares over and above 50,000 common shares, such additional amount not to exceed 2% of the outstanding common shares.”
