Strathcona, a Canadian company, wants to increase its stake in MEG Energy and opposes Cenovus' bid

Strathcona Resources, a Canadian oil and natural gas producer, announced on Thursday that it would buy an additional 5% of rival MEG Energy. It also said that they will vote against Cenovus Energy's acquisition of MEG.

Cenovus acquired MEG for C$7.9 Billion ($5.72 Billion) in cash and stock in August after Strathcona rejected MEG's C$6 Billion takeover offer in June.

MEG set the date of October 9 as a vote by shareholders on its proposed merger. The board has approved it, but at least two thirds of investors must support it for this deal to be completed. The deal should close in the first quarter of 2025.

The deal will create one of Canada's largest oil sands firms, by combining MEG Christina Lake's oil sands operations with Cenovus assets in the surrounding areas. This combination of assets is expected to produce over 720,000 barrels of oil sands each day.

Strathcona said that it would increase its ownership of MEG to 14.2%. This will strengthen its position as an important minority shareholder.

Adam Waterous, Strathcona’s executive chairman, said that the company would continue to engage with MEG shareholders until the deadline of September 15 for the tender offer.

MEG and Cenovus didn't immediately respond to requests for comments outside of regular business hours.

(source: Reuters)