SFH Inc. Transfers Shares to Purchaser

SFH Inc. has sold 2.5 million common shares in five entities to The 2020 Sandusky Investment Trust for $0.0001 per share. Prior to the sale, SFH held 16.2-21.9% ownership in these entities. The sale was conducted for private investment purposes and may lead to increased ownership or control in the entities as market conditions warrant. The sale was exempt from take-over bid requirements under National Instrument 62-104.

SFH Inc. (SFH), a British Columbia-based company, recently announced the sale of 2.5 million common shares in five entities to The 2020 Sandusky Investment Trust (SIT) [1]. Prior to the sale, SFH held a significant ownership stake, ranging from 16.2% to 21.9%, in these entities [1]. The transaction was conducted for private investment purposes and may lead to increased ownership or control in the entities as market conditions warrant [1].

Before diving into the implications of this sale, let's examine SFH's recent history with these entities. In June 2021, SFH acquired 250,000 common shares in 1287405 B.C. Ltd. (405) from 1261648 B.C. Ltd. (648) and AMKOR Enterprises [2]. This acquisition expanded SFH's ownership stake in 405, which was already substantial, as SFH held 13.5% of the company's shares prior to the acquisition [2].

The sale of SFH's shares to SIT, however, signifies a shift in ownership and control. Although the exact reasons for the sale are not disclosed, it is worth noting that SFH sold the shares for a nominal price of $0.0001 per share [1]. This price is significantly lower than the $1.00 per share SFH paid for the shares in 405 during the acquisition in 2021 [2].

The sale was conducted in accordance with the "private agreement exemption" in section 4.2 of National Instrument 62-104 - Take-Over Bids and Issuer Bids (NI 62-104) and was therefore exempt from take-over bid requirements [1]. This exemption is typically used for transactions between parties that are not subject to the same insider reporting requirements, such as arm's-length transactions between unrelated parties [3].

Despite the sale being exempt from take-over bid requirements, it is essential to monitor the market reactions to this transaction. The sale of a significant stake in these entities to a new investor like SIT could potentially lead to changes in management, strategic direction, or financial performance. Furthermore, the nominal sale price raises questions about the underlying value of SFH's ownership stake in these entities.

In conclusion, SFH Inc.'s recent sale of 2.5 million common shares in five entities to The 2020 Sandusky Investment Trust marks a significant shift in ownership and control. Although the transaction was conducted for private investment purposes and was exempt from take-over bid requirements, it is essential to monitor the market reactions and potential implications for the companies involved.

References:
[1] SFH Inc. Transfers Shares to Purchaser. (2023, August 4). Retrieved August 10, 2023, from https://www.newsfilecorp.com/release/176177
[2] SFH Inc. Acquires Shares from Sellers. (2021, June 28). Retrieved August 10, 2023, from https://www.newsfilecorp.com/release/88749
[3] National Instrument 62-104 - Take-Over Bids and Issuer Bids. (2023). Retrieved August 10, 2023, from https://www.bcsc.bc.ca/en/reg_resources/reg_docs/ni_62-104_take_over_bids_and_issuer_bids.pdf