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Crocus union shareholder resorts to activism to motivate MFL to act

Written by Wanda Pasz Sunday, 26 March 2006

In the past two weeks there has been a great deal of confusion about what is happening regarding a proposal from a B.C. based venture capital firm by the name of GrowthWorks to buy the assets of Manitoba's Crocus Investment Fund.

At a meeting held March 8th at the Victoria Inn in Winnipeg, which was organized by a group known as the Crocus Investors Association, the CEO of GrowthWorks, whose name is David Levi, explained details of his proposal to about 800 Crocus shareholders.

In brief, the proposal would see GrowthWorks pay each shareholder $1.50 in cash and a certain amount more in shares in what is known as the GrowthWorks Canadian Fund.

The final amount would be determined following a valuation of Crocus assets. Levi suggested that, if the receiver's assessment of Crocus's net value is correct, then the total payment to each shareholder would be in the order of $5.93 per share.

In order to be able to vote on the GrowthWorks proposal at a special general meeting of Crocus shareholders that would have to be called, it is necessary to gather at least 1700 "requisition" forms from shareholders. (The 1700 figure represents five percent of the total number of shareholders - the minimum number that can call for a meeting to take place, according to Manitoba's Corporations Act.)

The process of collecting those requisitions actually began that very evening and has continued since then. To date the Crocus Investors Association has collected over 1400 requisitions.

The goal of reaching the magic number of 1700 must be met by Tuesday, March 28th in order to present a motion on March 29th in court calling upon the judge who is overseeing Crocus's affairs, to call the special meeting.

Unfortunately, on Friday, March 10th the Manitoba Federation of Labour (M.F.L.) announced that it, too, was collecting requisitions for the same purpose as the C.I.A.

What has happened since is that shareholders have been sending in requisitions to different addresses and, rather than reaching the 1700 number fairly quickly, we now have a situation where neither party is likely to reach the 1700 total on its own.

Bernie Bellan, secretary of the C.I.A., has made repeated offers to the M.F.L. to turn over the requisitions that he has collected to them; however, for reasons that are known only to the M.F.L., Bellan's offers have not been accepted.

In truth, the likely explanation is that Bellan's constant criticisms of the M.F.L. for having been responsible for so much of went wrong at Crocus have made it hard for the M.F.L. even to consider allying themselves for this one occasion with someone whom they detest.

Bellan says that he is quite willing to put aside his own personal animosity toward the M.F.L. for the role that it played in propping up Crocus for so many years after it should have been closed down, and instead to work with the M.F.L. to make sure that the minimum number of requisitions are turned in to the court by March 28.

If any union member reading this is interested in putting pressure upon the M.F.L. to put aside its hostility to Bellan for the moment and cooperate with him, it might be useful to contact the M.F.L. directly.

The M.F.L. can be reached by phone at 204-947-1400 or by fax at 204-943-4276.

The person who is coordinating the M.F.L's requisition drive is Lorraine Christenson.

Her e-mail address is: .

The preceding submission was prepared by Bernie Bellan, who is also a member of the Canadian Union of Postal Workers. (He has been a letter carrier for 29 1/2 years.)

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