OTTAWA _ Business law experts say it’s difficult, if not impossible, to fence off a company’s potentially sensitive data and other intellectual property when it’s the target of a takeover bid.
Concerns over access to such information are said to be a key reason why the federal government rejected a Chinese state-controlled company’s bid to acquire the Toronto-based Aecon Group Inc. construction firm.
Earlier this week, the Trudeau government cited reasons of national security for its decision to block Aecon’s $1.5-billion purchase by CCCC International Holding Ltd.
A senior government source, who spoke on condition of anonymity due to the delicate nature of the file, says there were major concerns that the acquisition would’ve given China access to a wealth of sensitive data held by Aecon from its work on some of Canada’s most-critical infrastructure _ from nuclear power plants to the Toronto subway.
Colin Walker, a managing partner with Crosbie and Company Inc., in Toronto, says buying a company means obtaining all the assets that come with it _ including physical records and its employees’ own memories.
Walker says it’s very difficult for a deal to be structured in a way that would build a fence around certain assets.
The government source says in addition to information that would have been collected through future projects, the Aecon takeover would have given the Chinese firm access to intellectual property from the company’s long history of construction in Canada.
Aecon has worked on many key Canadian projects such as the CN Tower, Vancouver’s SkyTrain, the St. Lawrence Seaway, the Halifax shipyard, the refurbishment of Ontario’s Bruce nuclear plant and the Toronto subway.