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Oil sands giant Cenovus Energy Inc. completed the takeover of MEG Energy Corp.
Both companies owned adjacent properties in the Christina Lake oil sands, south of Fort McMurray, Alta. With the purchase, Cenovus will gain an additional 110,000 barrels of production per day from what was once MEG's flagship facility.
“The addition of MEG's assets and people will have an immediate positive impact on Cenovus,” Cenovus CEO John McKenzie said in a press release Thursday.
“The strategic fit is exceptional, the assets are of the highest quality, and the synergies we have identified will create significant value in both the short and long term.”
The deal was valued at more than $8.6 billion in cash, stock and assumed debt of MEG.
MEG shares are expected to be delisted from the TSX on Friday.
The deal's closing marks the end of a bitter saga that pitted Cenovus against rival Strathcona Resources Ltd. ultimately supported Cenovus's sweetened offer.
Cenovus's largest shareholder, CK Hutchison Holdings Ltd., said it was pleased with the acquisition.
“The close proximity of the two companies' complementary assets at Christina Lake has the potential to create powerful synergies,” a spokesman for the Hong Kong-based conglomerate, which has decades of experience investing in the oil sands, said in a statement.
