Here are five things you need to know this morning:
BHP and Lundin offer to buy Filo: Freshly rebuffed by Anglo American, global mining conglomerate BHP is teaming up with Canada’s Lundin Mining to form a joint venture to buy TSX-listed South American copper miner Filo Corp. The two companies will each own half of the new firm whose main asset is the Filo del Sol copper project in Chile. Though not yet operational, the massive mining site is near other sites the companies own in the area and the intention will be to consolidate operations to cut costs and run them more efficiently. At just over $4 billion Canadian, the deal is nowhere near the size of other tie-ups reportedly being contemplated bymajor miners, but nonetheless interesting. Call it a phyllo pastry appetizer for a possible main course to come.
Sleep Country trading above Fairfax offer price: When Fairfax Financial offered to buy Sleep Country Canada’s TSX-listed units for $35 a share earlier this month, the offer’s 28 per cent premium came as a pleasant wakeup to most investors. But the units have quietly ticked above Fairfax’s offer price this week, a suggestion that some buyers must think a better offer might emerge. Samir Taghiyev, a portfolio manager with Mawer Investment Management, one of the largest holders of the stock, told Bloomberg that Fairfax’s offer is close to fair value, even if the timing is “not the most ideal” since high rates have depressed valuations and the company’s margins. The units were worth about $28 apiece prior to the offer, well off their high of $41 hit back in 2021.
Delta lawyers up: Delta Airlines has hired legal eagle David Boies to represent the airline in forthcoming lawsuits against CrowdStrike and Microsoft, CNBC is reporting. The move is a clear sign that the airline will be seeking compensation from the two companies for the recent IT outage that grounded the airline’s fleet for several days, causing hundreds of millions of dollars of costs and lost revenue. CrowdStrike shares lost five per cent in electronic trading after the news came out on Monday, a sign of just how notable Boies’ reputation is. He’s been on one side or the other of countless precedent-making legal cases over the past few decades, from tangling with Microsoft during the U.S. Justice Department’s antitrust suit with the tech company in the 2000s, to more recently being a hired gun for defunct blood-testing firm Theranos.
TC Energy strikes deal to sell pipeline stakes to Indigenous group for $1B: TC Energy has confirmed a development first reported by Bloomberg that is has struck a deal with various Indigenous groups to sell a minority stake in the NGTL and Foothills pipeline system for $1 billion. As part of the pact, the Indigenous-led ownership group will own 5.34 per cent of the natural gas pipeline systems that operate across parts of B.C. and Alberta.
Chorus selling aircraft leasing business: Chorus Aviation Inc. has struck a deal to sell its aircraft leasing business to a consortium of investment funds controlled by New York-based HPS Investment Partners for $1.9 billion. The deal consists of $814 million in cash and $1.1 billion worth of debt to be assumed by the buyers. It’s a major U-turn for Chorus, which got into the leasing business in a big way when it acquired Falko Regional Aircraft and its fleet of jets in 2022. But rising interest rates have made it hard to finance and expand the business so Chorus is getting out of it. Chorus has been punished by investors this year, with the company’s market cap currently sitting at about $560 million. That’s roughly half of what it was worth in 2021.