Cygnet Energy acquires Kiwetinohk for $1 billion
The companies announced on Tuesday that Cygnet Energy, a privately held company, will purchase Kiwetinohk Energy for C$1.4 billion, including debt. This deal creates a larger Montney-Duvernay operator.
Montney and Duvernay in Alberta are Canada's most prolific oil and gas shale plays. They have driven much of the recent growth in production and investment in western Canada.
Cenovus Energy, Strathcona Resources and MEG Energy engaged in a battle to take over MEG Energy earlier this year. The companies were interested in its prized asset, the Christina Lake oil-sands project. It is located also near Alberta.
According to calculations, Cygnet's price per share will be C$24.75. This represents a premium 10.4% over Kiwetinohk’s last closing.
The merger of Simonette and Placid in Alberta will give the combined company more than 44,000 barrels per day of liquid-weighted oil production.
Cygnet said that the acquisition would make it a leader in operating Duvernay-Montney assets.
The funds for the acquisition are provided by existing Cygnet shareholders NGP Energy Capital Management, and Carlyle global investment firm who will become a new partner in Cygnet.
The companies expect the deal to close by late December. Reporting by Tanay in Bengaluru, and editing by Krishna Chandra Eluri.
(source: Reuters)
