The target company said after markets closed Wednesday that the Husky offer is opportunistic and undervalues its assets and prospects, adding it intends to conduct a formal process that could identify a white knight to make a better offer.
MEG shares rose by as much as 21 cents to $11 in morning trading on the Toronto Stock Exchange before falling back to near Wednesday’s close of $10.79 and then rising again to $10.85.
Analysts continued to speculate in overnight reports that Husky will have to raise its bid to win over MEG’s management.
They also found it doubtful that an alternate bidder will emerge for MEG given that its only product, oilsands bitumen, is facing severely discounted prices as new oilsands production from northern Alberta makes worse an export pipeline bottleneck.
In an email, Husky spokesman Mel Duvall says his company believes its offer is attractive, adding it intends to review MEG’s directors’ circular rejecting the deal in more detail before providing further comment.