A Rise in Shareholder Activism?
As part of my daily review of all filings (press releases & financial statements) on the Canadian market, I have recently begun to notice more and more cases of shareholder activism.
Since I didn’t know where to include this in my regular Good, Bad, and Ugly series, I opted to write a separate post.
Overall, I think plenty of mismanaged or poorly governed companies listed on the Canadian market are ripe for activism. That said, few investors have historically stepped up to the plate. This could be due to a few factors:
The lack of liquidity to build meaningful stakes in these stocks
The high legal costs associated with running a proxy battle
The high time and energy requirements to run a proxy battle
The relatively small size of most opportunities. Given that the time commitment and costs are relatively fixed, activists prefer to get involved with bigger opportunities where more capital can be deployed and more money can be earned for the same effort.
I’m not entirely sure why we’re seeing a rise in activism lately, but it’s good news for Canadian minority shareholders. Finally, some people will fight to keep management teams and boards accountable.
Here is an overview of the main ongoing or recently settled cases:
Reitmans (Canada) Limited (TSX-V: RET)
On May 13, 2025, a group of concerned shareholders, including Donville Kent Asset Management, Parma Investments, and a private investor, sent an open letter to Reitmans’ board calling for immediate action over governance concerns and stagnation of shareholder value.
The concerned shareholders are asking for a collapse of the dual-class share structure and a board refresh.
Collectively, they own approximately 13.7% of Reitmans’ shares, although most of their shares are Class A non-voting shares.
As far as I know, the company has not publicly responded.
INEO Tech (TSX-V: INEO)
COENDA Investment Holdings, an investment company controlled by Kerem Akbas, invested $4 million a few months ago to become a 50.8% shareholder of INEO. It only took a few months for Akbas to conclude that significant changes were needed at the company.
In April 2025, COENDA sent a requisition for a general meeting of shareholders to address some of its financial and governance concerns. The meeting was called, but the situation escalated to the point where the company alleged that COENDA sent anonymous threats. Ultimately, COENDA proposed four nominees to replace INEO’s board of directors.
Finally, cooler heads prevailed. A month after the initial press release, INEO announced a settlement with COENDA that involved appointing one new director proposed by COENDA, initiating the search for a new CFO, and INEO entering into a license agreement with a strategic business partner affiliated with COENDA.
RevoluGROUP Canada (TSX-V: REVO)
On May 31, 2025, a group of shareholders representing more than 10% of the issued and outstanding shares of RevoluGROUP submitted a proposal to the company’s board that outlined a plan to resolve the company’s financial issues. On June 10, the shareholder group made its proposition public in a press release due to the lack of response by the company.
A week later, the company acknowledged the proposal and expressed openness to reviewing it and working with the concerned shareholders to find a solution. In particular, the company welcomed the shareholder group's immediate nomination of a director and the willingness to convene an annual general meeting of shareholders.
Medipharm Labs (TSX: LABS)
This is a messy one.
On May 8, 2025, Apollo Technology Capital and its affiliates, who collectively own 3% of Medipharm’s stock, proposed to nominate six new directors to replace the company’s board over concerns about long-term shareholder value destruction.
The company responded by highlighting several immediate concerns, including the lack of a viable plan proposed by the dissident shareholders, their questionable track record, and their meritless allegations.
What ensued was a string of press releases from both sides airing some of the other side’s dirty laundry. You can read some of the press releases here and here.
The 6-week battle culminated in the AGM on June 16. A few hours before the shareholder meeting, the dissident group announced its victory in a press release due to an illegal and invalid procedure by Medipharm to solicit proxies, making the dissident proxies the only valid votes at the AGM.
Medipharm then issued a statement warning shareholders that the vote had not even occurred. The following day, Medipharm announced that a significant majority at the AGM had elected the management director nominees.
Essentially, both sides are claiming to have won the vote. I suspect we haven’t seen the end of this one yet.
COSCIENS Biopharma (TSX: CSCI)
On May 23, 2025, Goodwood Fund and Puccetti Funds Management notified COSCIENS that they intended to nominate six new directors at the upcoming AGM, following an ignored letter to the board in December 2024. The two entities collectively own a little over 8% of the shares outstanding.
If you’re unfamiliar with the name, COSCIENS Biopharma resulted from a merger between Ceapro and Aeterna Zentaris about a year ago.
It only took a week for the parties to come to an agreement. On May 30, the company announced a reconstituted board of six directors, including four proposed by Goodwood and Puccetti.
Let’s see if this will improve the company's performance in the future.
A Few More
As you probably know by now, I’m not active in the natural resources sector, nor is anything closely tied to commodities (such as drilling companies, oilfield services, etc.).
That said, I saw a few activist situations there as well for anyone interested:
Sherritt International (TSX: S) had a dissident shareholder holding 8% of the shares who sent a letter to the board and communicated its intention to vote against the current directors at the upcoming AGM. The initiative failed, and all the directors were re-elected.
In January 2025, Dynacor Group (TSX: DNG) received a request from iolite Partners, a 10% shareholder, to call a special meeting of shareholders to elect a new director proposed by iolite. The special meeting was called in April after a public fight, and shareholders voted the proposition down. However, iolite did not give up, issuing another letter in May to urge shareholders to withhold votes in the election of Dynacor’s chairman, Pierre Lépine, at the regular AGM. The results came out yesterday, and while there was a significant proportion of withheld votes, all directors were elected.
Cenatex Holdings LLC, a 14% shareholder in Bri-Chem (TSX: BRY), issued a press release on June 4, 2025, to communicate its engagement with Bri-Chem’s board and management team about ways to improve the company’s performance and long-term value. The company responded by postponing its AGM to assess the situation and provide more information to shareholders.
While not all activist situations turn out for the best, they can be attractive watch list candidates or opportunities to research more, particularly if you agree that some companies could improve corporate governance and long-term strategy.
For complete transparency, I don’t have any dogs in these fights, except for out-of-the-money INEO Tech warrants held in the Rivemont MicroCap Fund (see full disclaimer below).
I’ll be interested in watching some of these situations unfold and seeing their positive impact, if any.
Perhaps some successful outcomes will entice more shareholders to make their voices heard?
Disclaimer
This publication is for informational purposes only. Nothing produced under the Stocks & Stones brand should be construed as investment advice or recommendations. Mathieu Martin, the author, is employed as a Portfolio Manager with Rivemont Investments. This publication only represents Mathieu Martin’s own opinions and not those of Rivemont. Rivemont may own positions and transact on any securities mentioned in this publication at any time without prior notice. At the time of this writing, the Rivemont MicroCap Fund holds warrants of INEO Tech (TSX-V: INEO) with a strike price of $0.19 and an expiration date of November 17, 2025. Always do your own research and consult a professional before making investment decisions.
If you’d like to invest in small public companies, check out this post.
I would mention Quipt as well.