In Defense of Canada
March 9, 2010
I'm not quite sure why, but there's been a lot of Canada bashing lately. The Olympics seemed to open the door for trite commentary about poutine and Mounties, and at home, my wife is on an HGTV kick, but can't get through an episode of Property Virgins without a dig at the Canadian accent.
It's unwarranted as far as I'm concerned, although I'm biased for poutine.
In Canada, politicians there are considering how to make the country more appealing to foreign investors. This is something that has to please domestic dealmakers and growth investors who have been turned off by the red tape.
In the most recent Speech from the Throne, the government hinted that it would loosen foreign ownership restrictions in the telecom industry and also moved to clear hurdles blocking foreign investment in Canada's uranium mining industry.
While the Speech may signal a change to Canada's 46% cap on foreign ownership in telecom companies, it also reflects an understanding that an open market with true competition actually helps industries thrive.
For deal pros in the middle market, this should only make Canada more appealing of a destination. The opportunity -- even beyond telecom and uranium -- is already there, but it's nice to feel wanted. Tax changes next year should spawn a flow of orphaned companies that are no longer a fit for the income trust market. These are companies whose steady cash flows made them good fits for the dividend dispensing income trust market, and should translate nicely to what mid-market PE firms are looking for.
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Posted by: CHEN M | January 14, 2012 2:34 AM
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