CALGARY – Strathcona Resources Ltd. has begun its formal takeover bid for fellow oilsands producer MEG Energy.
Its offer comprises 0.62 of a common share of Strathcona and $4.10 in cash for each MEG share it doesn’t already own.
The offer is open until Sept. 15.
MEG says its board and legal and financial advisers will consider the offer, and that a special committee of independent directors will assist.
The target company is urging shareholders to take no action until it has made a recommendation, which it expects to do within 15 days.
Strathcona also announced an equity commitment letter with Waterous Energy Fund, whose CEO Adam Waterous is executive chairman of Strathcona.
The fund owns almost 80 per cent of Strathcona shares, and the new investment is worth about $662 million.
“WEF’s major further investment in Strathcona reflects our view that more than eight years into building Strathcona, our best years are in front of us. As part of the offer, we are asking MEG shareholders to join us as fellow shareholders in Strathcona and trust the Strathcona team as stewards of their capital,” Waterous said in a release Friday.
“We therefore believe it is important that we eat our own cooking, ensuring no one will be more focused on increasing Strathcona’s value beyond current levels than WEF. We firmly believe Strathcona represents compelling value at this price with a large margin of safety, and that we and the partners in our fund will do very well over the long run.”
This report by The Canadian Press was first published May 30, 2025.