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50m ago

Cenovus to Buy MEG Energy in C$7.9 Billion Cash-and-Stock Deal

MEG investors now face an October vote that will determine a planned fourth-quarter closing.

Cenovus Energy president and CEO Jon McKenzie takes part in a panel discussion during the Global Energy Show in Calgary on Tuesday, June 10, 2025. Gavin Young/Postmedia ,
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Overview

  • Cenovus will pay C$27.25 per MEG share with 75% in cash and 25% in stock, with elections subject to caps that imply about C$20.44 in cash plus 0.33125 Cenovus shares per MEG share on a pro‑rated basis.
  • Both boards unanimously approved the agreement, MEG’s board recommended it after a strategic review, and shareholders must approve by two‑thirds in October for an expected close in Q4 2025.
  • The combination would oversee more than 720,000 barrels per day and consolidate fully contiguous SAGD operations at Christina Lake, including roughly 110,000 bpd from MEG.
  • Cenovus projects about C$150 million in annual synergies near term, rising to more than C$400 million by 2028, says the deal is immediately cash‑flow accretive, and has arranged a C$2.7 billion term loan plus a C$2.5 billion bridge underwritten by CIBC and JPMorgan.
  • Strathcona’s competing unsolicited offer remains open until Sept. 15 and was worth about C$28.17 per MEG share based on Thursday’s close after it previously disclosed a 9.2% stake.