An Overview of Mixed Enterprises in Canada
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abstract
Mixed enterprises, which are corporations whose stock is held jointly by private and government shareholders, have become more prevalent. Such enterprises can be formed through federal or provincial governments or their agents making stock purchases, by the issuing of shares of firms that were previously government-owned to the public, or by a joint venture between government and private partners. The primary dimensions of mixed enterprises are: 1. profitability, efficiency, and risk, and 2. socio-political considerations. One example of a mixed enterprise is the Canada Development Corp. (CDC), of which 49% is owned by the Canada Development Investment Corp. (CDIC), a federal holding company. The CDC has had mixed results, including a C$3.8 million write-off of its investment in the Canadian Arctic Pipeline Ltd., and AES Data, in which CDC profits were C$85 million in 1981, but which had a loss of C$126 million in 1982. Indications are that the federal and provincial governments will continue to increase their participation in Canadian business through direct equity.
