(Oil Worth)– Beforehand rejected MEG Vitality bidder Strathcona Sources intends to purchase a further 5% stake in MEG and vote these shares and the present 9.2% stake towards the Cenovus acquisition provide for MEG, as the newest main Canadian deal faces hurdles in the direction of completion.
Final week, Cenovus Vitality introduced it has entered right into a definitive association settlement to accumulate MEG Vitality Corp in a money and inventory deal valued at US$5.7 billion (C$7.9 billion), together with assumed debt.
The settlement between Cenovus and MEG got here after a months-long saga through which suitors had sought to purchase MEG Vitality.
Earlier this 12 months, Strathcona Sources made an unsolicited provide to accumulate MEG Vitality, however MEG’s board rejected the provide and suggested shareholders to reject it too and never tender their shares.
MEG’s board mentioned in June that the share consideration in Strathcona’s provide exposes shareholders to an organization with inferior belongings, and that “MEG is a uniquely engaging funding alternative that warrants a premium valuation.”
On the time, MEG initiated a strategic assessment of options with the potential to floor a proposal superior to its standalone plan.
Final week, MEG agreed to be acquired by Cenovus in a deal that can consolidate adjoining, absolutely contiguous, and extremely complementary belongings at Christina Lake.
The transaction has been unanimously authorized by the boards of each corporations. Cenovus expects the acquisition to shut within the fourth quarter of 2025, topic to regulatory approvals and approval of the transaction by MEG shareholders.
MEG’s board recommends MEG Shareholders vote FOR the transaction at a particular assembly to be held on October 9, 2025.
Nonetheless, the rejected Strathcona is now placing up a combat and mentioned this week that it intends to buy a further 5% in MEG, topic to market circumstances. Along with the present 9.2% stake in MEG, Strathcona expects to have 14.2% within the goal firm.
“Following discussions with fellow MEG shareholders over the previous week, Strathcona intends to vote its MEG Shares (together with these it at the moment holds and subsequently acquires) towards the decision to approve the acquisition of MEG by Cenovus Vitality Inc., which requires approval by no less than 66 2/3% of the votes solid by MEG shareholders,” Strathcona mentioned.
By Tsvetana Paraskova for Oilprice.com
