Cenovus Energy makes a case for more meg energy offer by Strathankona Resources
Cenovus Energy Ink says its cash-end-stock bid for Meg Energy Corp provides a premium valuation and certainty on a rival all-stock offer by Stratchona Resource Limited.
The Cenovas said in a presentation to accept his arguments to accept the meg shareholder-friendly deal, “Senovus scale, industry-agronic experience, tear-1 assets, close-term growth, diverse revenue, a strong balance sheet and clearly defined.”
Last week, Strathankona modified his hostile proposal in 0.80 of a stock for each meg share, it is not already. Its initial overcher This was a combination of spring cash and stock. When the new bid was announced, it was priced at $ 30.86 per share, above $ 28.02.
The Cenovus offer contains 72 percent cash and 28 percent stock. Sanovas said that the inherent value of its bid is $ 28.44 and would represent a 39-percent premium where Meg’s stock was trading in mid-May. It said that this value would represent the highest value paid for pure-play steam-operated oysands assets.
Sanovas argues that the Stratchona deal carries significant negative risk if after a decline in shares of that company, the current share price of Stretthkona is called “Overwalld”.
The Meg Board unanimously recommended the shareholders to return the Senovus deal on the Streticona proposal, which is said “is originally ugly”.
Stretthkona has called the Cenovas Deal “Lopsard” and the sales process of the meg board “broken”, which is to accept competitive Strathacona dialect meaningfully without entertainment.
Adam Waters, Executive Chairman of Stretthkona, has noted that the stock of Senovus jumped 10 percent after the news of his deal with Meg last month, but usually the price of an acquisition falls after such an announcement.
He said that the stock market price of the Senovus is equal to the profit of $ 3.9 billion that MEG shareholders are mostly not able to enjoy, as they will only be the owners of four percent of a post-techover company.
Under the Stratchona deal, the meg shareholders will have 43 percent of the new unit.
The hopes of the Sanovas offer to be held on 9 October should be approved by MEG shareholders by two-thirds majority votes. Strathakona has said that he intends to vote for 14.2 percent interest in the meg against the deal.
Cenovus and Meg have side-by-side oelus properties to the south of Christina Lake, Fort McMarre, Alta, while Strathankona also operates in the region.
