OTTAWA/WINNIPEG, March 28 The Canadian
government will remove the 25-percent foreign investment cap on
medical isotope provider Nordion Inc in cases
that are deemed to be of net benefit to Canada, under
legislation introduced on Friday.
The proposed changes are contained in a lengthy bill that
will implement February's federal budget. Its passage is assured
because of the Conservative government majority in Parliament.
"The foreign ownership restrictions with respect to the
company were put in place when it was privatized in the early
1990s, and do not serve an ongoing purpose," said Melissa
Lantsman, spokeswoman for Finance Minister Joe Oliver.
"The removal of the foreign ownership restrictions will
allow Nordion to access more investment capital, enabling it to
better grow and create jobs, but is conditional on approval of a
transaction under the Investment Canada Act."
Nordion shares were down slightly in Toronto and New York in
late Friday trading.
Ottawa-based Nordion hired advisers Jefferies & Company in
early 2013 to examine options for its future. In July, the
company sold its targeted therapies division to British health
care company BTG PLC for $200 million in cash,
completing the review's first phase.
CEO Steve West said on March 7 that the review's second
phase is under way.
The company is one of the world's leading producers of
molybdenum-99, an isotope used in medical imaging, and it
depends on raw material from an aging facility of the
state-owned Atomic Energy of Canada Ltd (AECL) in Chalk River,
Ontario. That supply runs out in 2016, raising questions about
the future of that part of Nordion's business.
A medical isotope is a radioactive substance used mainly to
A spokeswoman for Nordion could not be immediately reached.
(Reporting by Randall Palmer in Ottawa and Rod Nickel in
Winnipeg; Editing by Steve Orlofsky and Ken Wills)