The minority shareholders’ Canadian Oil Sands’ shares are being exchanged for Suncor shares under a 4-party "triangular" amalgamation

Suncor, a CBCA corporation, recently acquired 73% of the common shares of Canadian Oil Sands on the basis of 0.28 of a Suncor common share for each COS common share. Second stage transactions now are proposed for the COS shares of the remaining shareholders to be exchanged for Suncor shares using the same exchange ratio. There will be no Plan of Arrangement – just a triangular amalgamation.

Suncor has formed a subsidiary (“Holdco”) which holds “Newco,” both with nominal assets. Under an amalgamation of Newco with COS under the ABCA, the minority COS shareholders will receive Suncor shares for their COS shares, and the 1 common share of Newco will be converted into the same number of common shares of Amalco as were formerly held by those exchanging shareholders. Holdco will likely then amalgamate under the ABCA with Newco.

Because after the first amalgamation Amalco will not be wholly owned by Suncor, there can be no bump to the ACB of the Amalco shares of Suncor under s. 87(9)(c). It is not obvious to me why Holdco was inserted into the planned transactions.

Neal Armstrong. Summary of Canadian Oil Sands under Mergers & Acquisitions – Subsequent Acquisition Transactions – Amalgamations - Shares.