TFI abandons plan to relocate to U.S. following shareholder backlash

financialpost.com:

Montreal-based TFI International Inc. is reversing plans to re-domicile from Canada to the United States just a few days after announcing its intention to move.

Last week, TFI surprised investors by unveiling plans to change its legal headquarters to the U.S., raising the ire of a major shareholder, the Caisse de Depot et Placement du Quebec (CDPQ), which said in a statement that it would make its “dissatisfaction” known.

On Monday afternoon, TFI reversed course.

“Based on feedback from shareholders received to date, TFI International will remain a Canadian corporation and will not pursue its previously-announced intention to re-domicile from Canada to the United States,” the transport and logistics company said in a press release.

Robert Yalden, the inaugural holder of the Stephen Sigurdson professorship in corporate law and finance at the Faculty of Law of Queen’s University, said he was surprised that TFI had announced the move before speaking to shareholders, such as CDPQ, which has a four per cent stake in the company.

CDPQ is particularly sensitive, he said, because it has a mandate of promoting business in Quebec and has a well-established history of pushing to keep head offices in the province.

For example, when American private equity firm TPG bought a majority stake in Cirque du Soleil in 2015, Yalden said the CDPQ took a firm stance calling for the entertainment company’s international headquarters to remain in Montreal. In 2013, CDPQ was also involved in the decision that Atrium Innovations Inc. kept its headquarters in Quebec when it was acquired by global investing firm Permira Holdings Limited and a group of Quebec investors.

TFI’s decision to redomicile would likely have drawn a reaction even without the