by Dr. Sherry Cooper
Chief Economist, BMO Capital Markets, BMO Nesbitt Burns & Harris Bank

The recent wave of foreign takeovers of Canadian companies has unleashed a fl ood of opinion on the various merits, or demerits, of this seemingly unstoppable trend. This year alone, more than $60 billion proposed or completed foreign acquisitions of major Canadian names have been announced, including Inco, Falconbridge, ATI, Dofasco, Intrawest, Hudson's Bay, Sleeman and Vincor. Given the sheer scale of these consolidations, it is hardly surprising that the hand-wringing is intensifying. However, at least one consolation is that, with the TSX close to all-time highs and the Canadian dollar still close to a 30-year high, buyers are generally paying premium prices for these companies—the real time for hand-wringing was during the wave of takeovers in 2001-02, when the loonie was limping close to 60 cents, equity valuations were hobbled, and Canadian companies went cheap.

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