Cenovus to Acquire MEG in $5.7B Deal

0
19
Cenovus to acquire MEG

Cenovus Energy announced Friday it will buy rival MEG Energy in a blockbuster CA$7.9 billion ($5.7 billion) cash-and-stock transaction, including debt. The move secures Cenovus’ dominance in Alberta’s oil sands and fends off a competing offer from Strathcona Resources, capping months of corporate jockeying in Canada’s energy sector.

The acquisition centers on Alberta’s Christina Lake oil sands, where Cenovus now positions itself as the undisputed heavyweight.

The Legal Teams Behind the Megadeal

The high-stakes transaction is being orchestrated by a cadre of heavyweight law firms: McCarthy Tétrault LLP and Paul Weiss Rifkind Wharton & Garrison LLP are guiding Cenovus, while Burnet Duckworth & Palmer LLP is advising MEG. Norton Rose Fulbright Canada LLP represents MEG’s special committee.

Signup for the USA Herald exclusive Newsletter

Terms of the Agreement

Under the deal, MEG shareholders will receive CA$27.25 per share — 75% cash and 25% Cenovus stock — with flexibility to choose between cash or shares. On a fully prorated basis, that translates to CA$20.44 in cash and 0.33125 of a Cenovus share per MEG share.

The agreement, still subject to shareholder and regulatory approvals, is expected to close in early Q4. Shareholders will vote on the deal in October.