Invest in Canada

Invest in Canada is an arms-length Government of Canada organization that promotes and attracts foreign direct investment into Canada. It was created through the Investment Canada Act and launched on March 12, 2018[1] as a departmental corporation.

Invest in Canada (IIC)
Government of Canada
HeadquartersOttawa
Productsinward investment support
Websiteinvestcanada.ca

History

Before the Invest in Canada agency was created, a division within the federal department Global Affairs Canada led the promotion of investment into Canada. In 1985, the Government implemented the Investment Canada Act to govern foreign direct investment. The Harper government used to limit foreign investment to no more than 50% share,[2] through a policy designed by Nigel S. Wright during his time at the PMO.

Foreign direct investment (FDI) by country[3] and by industry[4] are tracked by Statistics Canada; the total in 2012 of FDI was CA$634 bn.[3] New FDI inflow to Canada in 2011 was CA$40.8 bn.[5] Canada was host to CA$33 bn in state-owned enterprise investment over the period between 2005 and 2012.[6] Over the same period, the net FDI increased by CA$236.1 bn, so that SOE FDI was almost 14% of the total. Conversely, Canadian SOEs limit themselves to domestic affairs. The SOE of Canada are not aggressive in this manner: Canadian SOEs have no foreign investments.

The Canadian government is planning to raise to CA$1 bn the amount of foreign money that can go into a Canadian company before the investment is reviewed. As of 2012, an investment or takeover of a Canadian business by a WTO investor worth CA$330 mn or more triggers a federal review under the Investment Canada Act. The WTO was implemented in Canada by the World Trade Organization Agreement Implementation Act in 1994.[7] Innovation, Science and Economic Development Canada provides a helpful webpage with this information and explains that WTO members are eligible for CA$344 mn review-free investment as of 12 January 2013.[8] The WTO maintains a membership list.[9] The information on the WTO "amount" permitted by the discretion of the Minister of Industry under subsection 14.1(2) of the Investment Canada Act is published annually in January in the Canada Gazette. The government investigates whether the investment is of "net benefit" to Canada, which brings into play a nebulous political definition.[10] Amounts inferior to this limit do not incur political oversight under the Investment Canada Act, so that the foreign investor is treated like any other Canadian investor. This means effectively, that Canada is open to reverse takeover by stealth. Prime Minister Harper clarified this FDI policy area in Toronto on 7 November 2013 when he said that a little wiggle room was needed on foreign takeover rules.[11]

Bonds

On 5 November 2013, British Columbia finance minister Mike de Jong reported a successful placement of Chinese RMB$2.5bn in dim sum bonds.[12] The issue was five times oversubscribed.

Investments

2004

2005
  • On 21 August 2005,TUI AG unit Hapag-Lloyd agreed to acquire CP Ships Limited, including its Port of Montreal transshipment wharf, for €1.7bn (US$2bn) in cash. It has now made the combined fleet the fifth largest by capacity in the worldwide container shipping market.[15] In 2006 the CP Ships name disappeared for good. TUI AG plans to divest of Hapag-Lloyd, which is a 37% German SOE.

2006
  • In 2006 and 2007, Sinopec Shanghai Engineering Co. Ltd.'s Canadian subsidiary named SSEC Canada Ltd was hired by Canadian Natural Resources to build a structure on their Horizon Oil Sands project. On 24 April 2007, two Chinese temporary foreign workers were killed and five other Chinese temporary foreign workers were injured. SSEC was fined in October 2012 CA$1.5 mn for the incident. Investigations later determined that 132 SSEC workers had been unpaid since the start of their employment with SSEC. SSEC fled the country and the government was unable for a number of years to serve it legal documents.[16][17]
  • In January 2006, ArcelorMittal took over Dofasco, for CA$5.5 bn.[18]
  • In August 2006, Xstrata (subsequently delisted) CA$16 bn purchased for US$22.5bn Falconbridge Ltd. (subsequently delisted)[19]
  • In October 2006, Vale purchased 86% of INCO (subsequently delisted) for CA$15 bn[20]

2007
  • In January 2007, Bowater merged with Abitibi Consolidated to form a 52-48 joint venture called AbitibiBowater.[21]
  • In April 2007, Algoma Steel was purchased by India's Essar Group for US$1.63 billion, continuing operations as a subsidiary known as Essar Steel Algoma Inc.
  • In May 2007, a deal to acquire IPSCO steel (of Saskatchewan[22]) for $7.7 billion was announced by SSAB Swedish Steel AB.
  • In 2007, US Steel's CA$1.9 bn took over the bankrupt Stelco works (largely in Hamilton), subsequently idled in 2010 and finally shutdown in October 2013.[23]
  • In 2007, the UK Tate & Lyle conglomerate announced the sale of its Redpath Sugar refining business to American Sugar Refining
  • In June 2007, the ED Smith Income Fund accepted a takeover for CA$217 mn from TreeHouse Foods of Chicago.[24]
  • In July 2007, Rio Tinto acquired Alcan Inc., in a US$38 billion deal.[25] Rio Tinto Alcan subsequently divested itself of Alcan Engineered Products (to a consortium) and Alcan Packaging (to Amcor, announced in August 2009). In January 2013 the CEO in charge of the Alcan deal, Tom Albanese, stepped down in favour of Sam Walsh because he had overpaid.[26]

2008

2009

2010
  • On April 12, 2010, ConocoPhillips agreed to sell its 9% share in Syncrude to Sinopec, a Chinese SOE oil company. The sale, for $4.65 billion, was completed on June 25, 2010.[30][31]
  • In April 2010, Merit Mining Corp. was taken over by Tianjin Huakan Group Co. Ltd. in a CA$15.5 mn deal,[32][33] and in December 2010 subsequently renamed to Huakan International Mining Inc.[34] The transaction was funded by Hong Kong Huakan Investment Corp., an opaque Chinese investor located at Unit 1105, 11/F, Tower 1, Lippo Centre No. 89 Queensway, Admiralty, Hong Kong.[35][36][37]
  • The Norwegian SOE, Statoil, formed a 65-35 joint venture[38] with Husky Energy,[39] which is controlled in Hong Kong by Li Ka Shing.[40]

2011
  • Pohang Iron and Steel Company joint venture with Fortune Minerals, a $768mn project[41]
  • HD Mining International was taken over by Huiyong Holdings (BC) (55%) and Canadian Dehua Lvliang Ltd. (40%) to operate the Murray River project. Huiyong Holdings (BC) is 100% owned by Huiyong Holdings China, an opaque Chinese investor.[42][43]

2012
  • In October 2012, TransCanada Corporation and Phoenix Energy Holdings (aka PetroChina SOE) formed a 50-50 joint-venture CA$3 bn Grand Rapids Pipeline project in Northern Alberta (operated by Brion Energy Corp.).[44]
  • Athabasca Oil Corp. and Phoenix Energy Holdings (aka PetroChina SOE) 40-60 joint-venture in Dover oil sands project.[45]
  • In December 2012, Malay SOE, Petroliam Nasional, purchased for CA$6 bn Progress Energy (since delisted).[27][46]
  • In December 2012 was formed Baffinland, now a Nunavut Iron/ArcelorMittal 50-50 joint venture, with the latter as Project Operator[47]

2013
  • On 14 January 2013, JSC «Atomredmetzoloto», a unit of ARMZ Uranium Holding, which in turn is controlled by Russian SOE, Rosatom, bid US$1.3bn for the 49% stake it didn't already own in Uranium One, a Canadian miner with holdings in Kazakhstan.[48][49]
  • On 29 January 2013, AltaGas and Idemitsu Kosan formed a 50-50 joint venture named Triton LNG Limited Partnership, to export Alberta LNG to Japan.[50][51]
  • In February 2013, ExxonMobil took over Celtic Exploration Ltd. in a deal valued at CA$3.1 bn[52][53] because of holdings in the Duvernay Formation.[54]
  • In February 2013, CNOOC (a Chinese SOE) purchased for CA$15.1 bn Nexen Canada[55]
  • In June 2013, the H. J. Heinz Company was sold to Berkshire Hathaway and 3G Capital of Brazil for CA$28 bn.[56] The deal had been agreed in February of that year.[57] Included in this deal was the Heinz tomato ketchup plant in Leamington, which later was closed in November 2013,[56] after the October announcement by McDonald's that they would stop serving Heinz products in their restaurants, because the CEO hired by Heinz, Bernardo Hees, was then vice-chairman of Burger King, which was at the time owned by 3G Capital.[58]
  • In November 2013, Talisman Energy sold 75% of its Montney Formation gas holdings to Petronas SOE for CA$1.5 bn.[59] The transaction involves 127,000 acres.[60]
  • In November 2013, Petronas SOE 90% subsidiary Pacific Northwest LNG announced its plans to build a CA$11 bn LNG terminal on Lelu Island. The plant is still in its early design phases; only 25 employees have been hired.[61]
  • In December 2013, EnCana and PetroChina SOE formed a 50.1-49.9 joint venture (total CA$4.4 bn) to develop the Duvernay Formation in Alberta.[52]
  • On December 16, 2013, it was announced that Reynolds Consumer Products Inc., subsidiary of Rank Group Ltd. of New Zealand, planned to purchase aluminum products manufacturer Novelis, subsidiary of Hindalco of India for CA$35 mn.[62]
  • On December 24, 2013, Sherritt International divested itself of Alberta and Saskatchewan coal properties valued at CA$465 mn to the benefit of Colorado-based Westmoreland Coal[63]

2014
  • On 31 January 2014, Norwegian SOE Statoil and Thailand SOE PTTEP announced their plan to split their 60-40 joint-venture in the Kai Kos Dehseh oilsands project, so that they would each control 100% of their own leasehold properties. PTTEP spent $2.3bn on the joint venture in 2011. PTTEP got the "Thornbury", "Hangingstone" and "South Leismer" leases, while Statoil obtained the "Leismer" and "Corner" properties and was to pay $200mn to PTTEP.[64][65]

However, in September 2014, Statoil postponed its investment in the "Corner" project.[65]

  • On 12 February 2014, Mexican baker Grupo Bimbo announced a $1.83bn takeover of Canada Bread, a publicly traded corporation which had been controlled by Maple Leaf Foods.[66] Canada Bread sales in 2013 were estimated at $1.6bn, and its employees numbered 5,400.[66] By contrast, Bimbo employs 126,000 people at 144 plants in 19 countries, including Mexico, Latin and South America, the United States, Europe and Asia.[66]
  • Canada's fifth-largest independent oil producer, Talisman Energy, was purchased by Repsol, the Spanish oil major, for $8.3 billion plus the assumption of $4.7 billion of Talisman's debt.[67][68]

The oil sands in Alberta cover a vast area, and the pipelines needed to ferry their output to the BC coastline, where it will be transported by ship to Asian markets, span a wide range of investments. Many joint venture projects with foreign firms exist because Canadian capital is insufficient. Examples of news articles that have yet to be harvested for this wiki are a CBC article,[69] and the BC regulator,[51] as well as p. 13 of a report from Ernst and Young.[70]

2015
  • On 16 April 2015 the Saudi Agricultural and Livestock Investment Co. (SALIC) partnered with U.S. agribusiness giant Bunge Limited to form Global Grain Group (G3), which will be the majority owner of Winnipeg-based Canadian Wheat Board with an investment valued at $250-million.[71][72][73] As the principal was less than the government-regulated threshold, the investment incurred no review.

2016
  • Thalmic Labs, wearable computing start up invested US$158 Million
  • Real Matters, a property valuation services received US$100 Million
  • Buildscale, a video marketing platform received US$49 Million[74]
  • BlueRock Therapeutics, operating in regenerative medicine received US$295 Million by Versant Ventures
  • Dal Cor Pharmaceuticals received US$126 Million by Sanderling Ventures
  • Zymeworks, operating in antibody and Protein Therapeutics received US$87.8 from BDC Capital[75]

2017
  • One large investment in 2017 was the purchase by Hong Kong's Li Ka-Shing who purchased Reliance Home Comfort - a water heater and air conditioning firm for $2.82 billion.[76]
  • In March 2017, Teutech Industries, a Guelph, Ontario, based manufacturer of precision machined and heat treated powertrain components, was acquired by Indian auto component manufacturer The Hi-Tech Gears at US$44 million investment[77]
  • A Chinese consortium purchased privately held Valiant-TMS which designs and builds automated production systems.[78]
  • In June 2017, Montreal, Quebec-based Element AI raised US$102 million in a funding series led by San Francisco-based Data Collective[79]

References
  1. "Government of Canada launches Invest in Canada to attract global investment and create jobs, News Release, March 12, 2018
  2. "Alberta courts China as ‘key’ energy market in framework deal" 18 Oct 2013 Financial Post
  3. Statistics Canada Foreign Investment by Country
  4. FDI by industry (NAICS)
  5. FDI inflow tracked by Government of Canada
  6. Globe 28 Oct 2013 "Canada's slow oil, gas infrastructure development worry Chinese, minister says"
  7. Text of the "World Trade Organization Agreement Implementation Act", SC 1994, c 47
  8. "Thresholds for Review", Industry Canada
  9. WTO membership list
  10. "Ottawa moves to limit foreign investment reviews" CBC 25 May 2012
  11. "Harper says clarity not needed on foreign takeover rules " G+M 8 Nov 2013
  12. "Canadian Province Issues Offshore Yuan-Denominated Bonds" 5 Nov 2013
  13. usatoday.com: "Smucker buys International Multifoods for $500M" 8 Mar 2004
  14. kornferry.com recruitment ad for "Vice-President, Supply Chain" of Smucker's
  15. TUI press release about CP Ships
  16. "Financial Post: "Lessons of oil-sands tragedy" (D. Francis) date unknown". Archived from the original on 2014-02-02. Retrieved 2014-01-20.
  17. G+M: "Suncor staffer dies at oil-sands project site" (Tait) 19 Jan 2014
  18. "Dofasco recommends acceptance of Arcelor bid". CBC News. 2006-01-24.
  19. "Financial Post: "How Xstrata won Falconbridge"". Archived from the original on 2013-10-03. Retrieved 2013-09-27.
  20. Bloomberg: "Vale Buys Control of Canadian Nickel Miner Inco" 24 Oct 2006
  21. "Abitibi, Bowater merging to create forestry giant". CBC News. 2007-01-30. Retrieved 2009-04-16.
  22. "The company known today as “IPSCO Inc.,” one of the world’s leading producers of steel plate and pipe, began its corporate life in Regina, Saskatchewan on July 13, 1956, as “Prairie Pipe Manufacturing Company Ltd.”..."
  23. G+M 30 Oct 2013 "U.S. Steel ends an era in Hamilton"
  24. cbc.ca: "Jam maker E.D. Smith relishes takeover by U.S. pickle giant" 25 Jun 2007
  25. "Rio Tinto, Alcan reach US$38.1-billion merger deal". CTV.ca. 2007. Retrieved 8 August 2007.
  26. G+M: "Dented by aluminum, Rio Tinto aims to unload Iron Ore Co." 1 Mar 2013
  27. WSJ: "Chinese steel giant eyes Rio Tinto assets" 27 Sep 2013
  28. G+M "The man behind the Teck-CIC deal" 3 Jul 2009
  29. Nova Chemicals: "Company History and Development"
  30. "China's Sinopec takes $4.65-billion US stake in oilsands with ConocoPhillips buy". Vancouver Sun. 13 April 2010. Archived from the original on 2014-01-21. Retrieved 1 April 2012.
  31. "ConocoPhillips Sells Syncrude Stake to Sinopec". Press Release. RigZone. 25 June 2010. Retrieved 25 June 2010.
  32. Report on Business Magazine, Nov 2013
  33. "Merit Mining Corp. Signs Subscription Agreement with Hong Kong Huakan Investment Co., Limited" 10 Apr 2010, Huakan press release
  34. "Merit Mining Corp. Changes Name" 15 Dec 2010 Huakan press release
  35. Bloomberg Businessweek "Company Overview of Hong Kong Huakan Investment Co., Ltd"
  36. "HONG KONG HUAKAN INVESTMENT CO., LIMITED; Local Company" companies-hongkong.com
  37. "EARLY WARNING REPORT PURSUANT TO NATIONAL INSTRUMENT 62-103"
  38. Offshore Technology: "Mizzen Prospect"
  39. G+M "Husky, Statoil laud big offshore Canada oil find " 26 Sep 2013
  40. Rebecca Penty (November 1, 2012). "Husky Profit Rises on Refining Margin as Production Falls". Bloomberg.
  41. "investnorthwestbc.ca: "Arctos Anthracite Project (formerly Mount Klappan Anthracite Metallurgical Coal Project)"". Archived from the original on 2013-09-30. Retrieved 2013-09-27.
  42. "About HD Mining International Ltd" company webpage
  43. "B.C. coal mine has close ties to Chinese government, steelworkers say" 19 Dec 2012 Globe and Mail
  44. "TransCanada Corp And Phoenix Energy Holdings Ltd. Form Joint Venture To Develop Grand Rapids Pipeline System" 29 Oct 2012
  45. "Athabasca shares plummet as First Nation wins leave to appeal" G+M 18 Oct 2013
  46. Financial Post: "Petronas completes $6-billion Progress Energy acquisition after deal gets Ottawa’s approval" 12 Dec 2012
  47. marketwatch.com 13 December 2012 "ArcelorMittal and Nunavut Iron Ore become equal partners in Baffinland"
  48. bloomberg.com: "ARMZ Seeks Rest of Uranium One for $1.3 Billion; Won’t Raise Bid " 14 Jan 2013
  49. FP: "Uranium One bought by top Russian shareholder ARMZ for $1.3-billion; Russia's ARMZ snaps up rest of Uranium One for $1.3-billion" 14 Jan 2013
  50. "AltaGas Ltd. and Idemitsu Kosan Co., Ltd. Form Partnership to Pursue Opportunities to Export Energy From Canada" 29 Jan 2013
  51. ""INFORMATION BULLETIN: Triton LNG joins list of B.C. proposals" gov.bc.ca". Archived from the original on 2013-12-07. Retrieved 2013-12-03.
  52. 13 Dec 2012, Financial Post: "Encana, PetroChina form joint venture to develop natural gas in Alberta"
  53. "Ottawa approves Exxon Mobil’s $3.1-billion bid for Celtic Exploration " 20 Feb 2013
  54. "albertaoilmagazine.com: "ExxonMobil's takeover of Celtic Exploration closes"". Archived from the original on 2016-04-05. Retrieved 2013-10-18.
  55. Reuters: "CNOOC closes $15.1 billion acquisition of Canada's Nexen" 25 Feb 2013
  56. G+M: "Heinz to close Ontario factory, trim 740 jobs" 14 Nov 2013
  57. "Berkshire Hathaway, 3G Buying Heinz for $23.3 Billion". Cnbc.com. November 21, 2012. Retrieved 2013-02-14.
  58. cbc.ca "McDonald's to stop using Heinz ketchup at its restaurants; 34,000 stores worldwide affected by what some call 'corporate battle of the century'" (AP) 28 Oct 2013
  59. "Foreign investment doesn’t need ‘absolute clarity': Harper" Toronto Star, 8 Nov 2013
  60. 8 Nov 2013, Bloomberg "Talisman Sells Montney to Petronas for $1.4 Billion"
  61. "Petronas moves to secure Asian market with natural gas megaproject" 17 Nov 2013 G+M
  62. "Novelis sale to Reynolds could lead to job cuts" G+M 16 Dec 2013
  63. "Major shareholder calls for board shakeup as Sherritt exits coal" RACHELLE YOUNGLAI - MINING REPORTER The Globe and Mail
  64. G+M "Statoil, PTTEP deal to test tighter oil sands rules" 31 Jan 2013
  65. Dan Healing (9 September 2014). "Statoil puts oilsands expansion on hold". Calgary Herald.
  66. G+M: "Mexico’s Grupo Bimbo buying Canada Bread for $1.83-billion" 12 Feb 2014
  67. Repsol to buy Talisman Energy for hefty premium, 16 Dec 2014
  68. "cbc.ca Business News>Talisman agrees to $15.1B Cdn takeover by Spain's Repsol".
  69. cbc.ca: "The Horizon Oil Sands site" 7 Jan 2011
  70. "ey.com: "Exploring the top 10 opportunities and risks in Canada's oil sands 2012"" (PDF). Archived from the original (PDF) on 2013-06-23. Retrieved 2014-01-20.
  71. "U.S., Saudi firms to buy former Canadian Wheat Board". The Globe and Mail. 15 April 2015. Retrieved 15 April 2015.
  72. Water-poor Saudi Arabia invests in Canadian Wheat Board’s grain", 16 Apr 2015
  73. globeandmail.com: "Manitoba port feels squeeze from grain industry shakeup", 28 Apr 2015
  74. JLL (2016). "Technology Outlook 2016, Canada" (PDF). Jones Lang Lasalle. Archived from the original (PDF) on 2018-07-06. Retrieved 2018-07-06.
  75. Reuters, Thomson (2016). "Canadian Venture Capital Review Full Year 2016" (PDF). Canadian Venture Capital Review Full Year 2016.
  76. "Foreign direct investment in Canada plunges to the lowest in eight years". Financial Post. 2018-03-01. Retrieved 2018-07-06.
  77. Group, SKP (2017). "Investment Chronicle January – March 2017" (PDF). Investment Chronicles by SKP Group.
  78. "Chinese group makes key acquisition in manufacturing". Retrieved 2018-07-06.
  79. "Canada's Burgeoning Tech Sector Is Attracting More US Venture Money - Crunchbase News". Crunchbase News. Retrieved 2018-07-06.
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