The Newfoundland government is deciding whether to impose ownership limits on Fishery Products International (FPI). The move could cap an investor’s equity stake in FPI at 15%.
Other measures the government is considering include giving itself a seat on the board and the power to stop the company making redundancies. Moreover, the government is reported to be considering legislating against anyone suing it for compensation or damages arising from any changes to the act governing FPI, which is incorporated under provincial charter in recognition of its special role in Newfoundland, reports the Globe and Mail newspaper.
Such a move could upset FPI’s plans to create Canada’s largest seafood company. John Risley, president of Clearwater Fine Foods, is currently going through a US$510m reverse takeover bid that would leave him in control of FPI. The deal would see Clearwater acquire a 15% voting stake in FPI and a 57% equity stake.
Concern is being voiced that the government’s plans could discourage investment in the province.
For earlier news on FPI, just-food.com members should click here.
