NEW YORK, April 9, 2019 /CNW/ - Mangrove Partners
("Mangrove"), who together with Bluescape Energy Partners is
one of the largest shareholders of TransAlta Corporation
("TransAlta" or the "Company") (TSX:TA) (NYSE:TAC)
with aggregate ownership of 10.1% of the Company's outstanding
shares, yesterday filed an application for a joint hearing with the
Alberta Securities Commission ("ASC") and the Ontario
Securities Commission ("OSC") in relation to TransAlta's
2019 annual and special meeting of shareholders (the "2019
ASM") and the proposed $750
million transaction (the "Brookfield Transaction")
between the Company and Brookfield BRP Holdings (Canada) Inc. ("Brookfield"), pursuant to the terms of an
Investment Agreement, dated March 22,
2019, between TransAlta and Brookfield.
Among the orders requested, Mangrove seeks an order conditioning
the Brookfield Transaction on a vote of TransAlta shareholders not
having an interest in the Brookfield Transaction (the
"Shareholder Vote"). Such a vote would exclude
Brookfield and any other
shareholder with a material interest in the Brookfield
Transaction. Mangrove has also requested that the ASC and OSC
require TransAlta to provide shareholders with full and accurate
disclosures related to the Brookfield Transaction, as well as
analysis of the implication of these disclosures for purposes of
the Shareholder Vote, in order that shareholders may make a fully
informed decision at the 2019 ASM and on the vote to consider
approval of the Brookfield Transaction.
Requiring a separate shareholder vote on the transaction, with
appropriate disclosure for shareholders to make a fully informed
decision, will provide TransAlta and its shareholders with a clear
opportunity to consider the potential for superior alternatives and
to reject the Brookfield Transaction if any should emerge. In
addition, a separate vote will eliminate the coercion that
TransAlta shareholders currently face at the 2019 ASM, given how
the Board has tied together the Brookfield Transaction with the
election of management's nominees.
Nathaniel August, President and
Portfolio Manager at Mangrove Partners, said, "Like any TransAlta
shareholder, we cannot yet know whether the Company's proposed
investment from Brookfield is in
the best interest of all shareholders, given signs of a rushed
negotiation and the Company's limited disclosures. However,
we do know that the transaction resulted in a sale of a material
interest in TransAlta's crown jewel hydro assets and a significant
restriction on the Company's ability to deal with those assets in
the future, all with the apparent purpose of protecting TransAlta's
Board against challenge at the 2019 annual meeting. The
TransAlta Board also negotiated provisions that will protect it for
years to come by giving management voting control over a large
block of shares through to the 2022 annual shareholders
meeting."
Mr. August concluded, "In the face of such obvious entrenchment,
shareholders' only remedy is for the Company to provide full
disclosure on how and why the Company negotiated the Brookfield
Transaction. Then and only with the benefit of this
information, TransAlta shareholders not having an interest in the
Brookfield Transaction must be given a full, unhindered vote on the
deal and on who will represent them on the next board of
directors."
In the interest of preserving all shareholders' say on these
important governance matters for TransAlta, Mangrove also seeks
orders from the ASC and OSC that TransAlta postpone the 2019 ASM
until at least June 1, 2019 and that
Brookfield undertake not to vote
any of the shares owned by it, or any entity affiliated or
associated with it, on the election of directors at the 2019
ASM.
About Mangrove Partners
Mangrove Partners is a value-oriented investment manager founded
in 2010. Mangrove's investment objective is to organically compound
net worth while minimizing the chances of a permanent loss of
capital.
Forward-Looking Statements
Certain statements and information contained herein constitute
"forward-looking information" and/or "forward-looking statements"
within the meaning of applicable securities laws (collectively, the
"forward-looking statements"). All statements and
information, other than statements of historical fact, included
herein are forward-looking statements. Forward-looking statements
can be identified by the use of words such as "may", "would",
"could", "should", "potential", "will", "seek", "expect", "intend",
"plan", "estimate", "anticipate", "believe", "continue" or similar
words and expressions or the negative thereof. There can be no
assurance that the plans, intentions or expectations upon which
these forward-looking statements are based will occur or, even if
they do occur, will result in the performance, events or results
expected. We caution readers not to place undue reliance on
forward-looking statements contained herein, which are not a
guarantee of performance, events or results and are subject to a
number of risks, uncertainties and other factors that could cause
actual performance, events or results to differ materially from
those expressed or implied by such forward-looking statements.
These factors include: changes in TransAlta's strategies, plans or
prospects; general economic, industry, business, regulatory and
market conditions; actions of TransAlta and its subsidiaries
or competitors; conditions in the energy industry; risks relating
to government regulation and changes thereto; the state of the
economy including general economic conditions globally and economic
conditions in the jurisdictions in which TransAlta operates; the
unpredictability and volatility of TransAlta's share price; the
interest of third parties in potential transactions with TransAlta
that would be alternatives to the Brookfield investment; changes in commodity
prices and tax rates and government regulation of carbon emissions;
and currency fluctuations;. These factors should not be construed
as exhaustive. Shareholders are cautioned that all forward-looking
statements involve known and unknown risks and uncertainties,
including those risks and uncertainties detailed in the continuous
disclosure and other filings of TransAlta and certain members of
TransAlta's industry and other noted peer groups with applicable
securities regulators, copies of which are available on SEDAR at
www.sedar.com or on the Electronic Data Gathering, Analysis, and
Retrieval at www.sec.gov. We urge you to carefully consider those
risks and uncertainties. The forward-looking statements contained
herein are expressly qualified in their entirety by this cautionary
statement. Mangrove and Bluescape do not assume responsibility for
the accuracy or completeness of the forward-looking statements. The
forward-looking statements included herein are made as of the date
of press release and Mangrove and Bluescape undertake no obligation
to publicly update or revise such forward-looking statements,
except as required by applicable law.
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SOURCE Mangrove Partners