Suncor Energy Inc. (SU) launched an all-stock hostile bid for Canadian Oil Sands Ltd. valued at about C$4.3 billion ($3.29 billion), as the company increases its focus on Canada's oil sands.
Each Canadian Oil Sands shareholder will receive 0.25 of Suncor shares for each share held, the company said on Oct. 5.
The offer works out to C$8.84 per share based on Suncor's close on Oct. 2 and represents a premium of about 43% to Canadian Oil Sands' last close on the Toronto Stock Exchange.
The deal is valued at about C$6.6 billion including Canadian Oil Sands' debt of C$2.3 billion as of June 30.
Canadian Oil Sands and Suncor are among stakeholders in Canada's largest synthetic crude project, Syncrude, in northern Alberta.
Alberta's oil sands are the world's third-largest crude reserves after Saudi Arabia and Venezuela and a leading source of U.S. crude imports.
Suncor in September bought a tenth of the Fort Hills oil sands project in northern Alberta from French oil company Total SA (TOT).
The tender offer for Canadian Oil Sands will be open until Dec. 4 unless extended or withdrawn, the company said.
Suncor's financial adviser is JP Morgan Securities LLC while Blake, Cassels & Graydon LLP and Sullivan & Cromwell LLP are its legal advisers. ($1 = 1.3076 Canadian dollars)
Recommended Reading
Comstock Continues Wildcatting, Drops Two Legacy Haynesville Rigs
2024-02-15 - The operator is dropping two of five rigs in its legacy East Texas and northwestern Louisiana play and continuing two north of Houston.
Tech Trends: SLB's Autonomous Tech Used for Drilling Operations
2024-02-06 - SLB says autonomous drilling operations increased ROP at a deepwater field offshore Brazil by 60% over the course of a five-well program.
TPH: Lower 48 to Shed Rigs Through 3Q Before Gas Plays Rebound
2024-03-13 - TPH&Co. analysis shows the Permian Basin will lose rigs near term, but as activity in gassy plays ticks up later this year, the Permian may be headed towards muted activity into 2025.
US Drillers Add Most Oil, Gas Rigs in a Week Since September
2024-03-15 - The oil and gas rig count, an early indicator of future output, rose by seven to 629 in the week to March 15.
US Drillers Add Most Oil Rigs in a Week Since November
2024-02-23 - The oil and gas rig count rose by five to 626 in the week to Feb. 23