Calgary oil and gas company Husky Energy announced on 30 September that it has made an unsolicited offer for rival MEG Energy
The deal would see the purchase of MEG’s outstanding shares, valued at $3.3bn, as well as assumption of its $3.1bn debt.
In its press release the firm said the offer would deliver an “immediate 44% premium for MEG shareholders”, offering $11 per share.
As well as this premium, the statement said that the transaction would immediately meet MEG’s Vision 2020 financial targets.
“Together Husky and MEG will create a stronger Canadian energy company, headquartered in Calgary, Alberta,” the statement read.
“While Husky remains prepared to engage in discussions with MEG’s Board of Directors to complete the transactions expeditiously for the benefit of MEG shareholders, it intends to commence an offer directly to MEG shareholders by way of a takeover bid so they can determine the future of their investment.”
The combined output of both companies would build a total Upstream production of 410,000 barrels of oil per day, with a Downstream refining and upgrading capacity of around 400,000 barrels per day.
“Husky is confident the proposed transaction is in the best interests of Husky and MEG shareholders, employees, and stakeholders,” Husky CEO Rob Peabody said.
The statement adds that the combined company would be a leader of innovation in “carbon capture and storage, energy efficiency, enhanced SAGD and diluent reduction technology,” and would enable the acceleration of projects amidst a challenging time for the Canadian energy market.