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01 October 2015

Farris represents United Flower Growers in novel corporate restructuring

On September 30, 2015, United Flower Growers Co-operative Association (UFG), a co-operative association that operates auction facilities for British Columbia flower growers, completed a corporate restructuring.  The restructuring was accomplished through a plan of arrangement approved by the BC Supreme Court which included the amalgamation of a co-operative association with a British Columbia corporation under the BC Business Corporations Act (BCBCA).  This is believed to be the first time that a co-operative association has directly amalgamated with a BCBCA corporation.

Under the restructuring, the flower auction assets of UFG were transferred to a new cooperative association, while the amalgamated UFG will continue to hold real estate assets and non-auction businesses.

A preliminary and important question revolved around whether the court could approve a plan of arrangement involving a BC co-operative association with its wholly owned subsidiary, which was a BCBCA company.  Despite opposition from a member of UFG, the court approved the plan of arrangement.

Notably, the court approved the arrangement despite the absence of a fairness opinion, agreeing that such is not required when there is an internal reorganization rather than an acquisition by another company.  The court also approved the arrangement despite the absence of dissent rights, which is very unusual in Canada.

UFG was represented on the restructuring transaction by a Farris team led by David J. Selley and that included Teresa M. Tomchak (litigation) and Nicole Cameron (real estate).

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