Ames Brothers Ltd ABL is a relatively small producer of
Ames Brothers Ltd. (ABL) is a relatively small producer of petrochemicals located in Sarnia. The common shares of the firm are publicly traded on the Toronto Stock Exchange, while the non-voting preferred shares are traded on the over- the- counter market. Because of the strategic competitive position of the firm, there was considerable recent interest in the shares of the company. During 20X6, much active trading occurred, pushing the price of the common shares from less than $ 8 to more than $ 20 by the end of the year. Similarly, the trading interest in the preferred shares pushed the dividend yield from 12% to only 9%.
Shortly after the end of 20X6, three other firms made public announcements about the extent of their holdings in ABL shares. Silverman Mines announced that it had acquired, on the open market, 32% of the common shares of ABL; Hislop Industries announced that it had acquired 24% of ABL’s common shares in a private transaction with an individual who had previously been ABL’s major shareholder; and Render Resources announced that it had accumulated a total of 58% of ABL’s preferred shares.
However, Silverman Mines and Hislop Industries are related. The Patterson Power Corporation owns 72% of the voting shares of Silverman Mines and 38% of the voting shares of Hislop Mines. There are no other large holdings of stock of either Silverman or Hislop. Render Resources is not related to Silverman, Hislop, or Patterson.

a) Has a business combination occurred in 20X6, with respect to ABL, as the term “business combination” is used in IFRS? Explain fully.
b) What implications do the various accumulations of ABL shares have for the financial reporting (for 20X6 and following years) for:
1. Silverman Mines
2. Hislop Industries
3. Render Resources
4. Patterson Power Corporation

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