MEG Energy urges shareholders to reject takeover offer by Strathcona Resources

The Canadian Press

· Posted: Jun 16, 2025 10:27 AM EDT | Last Updated: June 16

MEG Energy Corp.'s committee of directors is urging shareholders to cull an unsolicited takeover connection by oilsands adjacent Strathcona Resources Ltd., calling it opportunistic and not successful the champion interests of the institution oregon its investors.

"Strathcona's connection is inadequate by each tenable measures and is not the close way guardant for MEG shareholders," committee seat James McFarland said Monday.

The institution said it has a program that the committee believes volition make important escaped currency travel and shareholder value, underpinned by its assets with decades of maturation potential.

Strategic reappraisal launched

The committee has authorized a peculiar committee to motorboat a strategical reappraisal with the imaginable to find an connection superior to its stand-alone plan. Analysts person said a competing connection is likely, citing oilsands majors similar Cenovus Energy Inc., Imperial Oil Ltd., and Canadian Natural Resources Ltd. arsenic imaginable bidders.

MEG operates the Christina Lake oilsands task southbound of Fort McMurray, Alta.

Last month, Strathcona made an connection to bargain each of the MEG shares it does not already ain for a operation of 0.62 of a Strathcona stock and $4.10 successful currency per MEG share. MEG shares person consistently been trading higher than the implied connection price.

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On a telephone with analysts past month, Strathcona enforcement president Adam Waterous said his institution and MEG person assets truthful complementary they are similar "doppelgangers" oregon "brothers from different mother."

Strathcona and MEG some extract bitumen utilizing steam-driven techniques successful eastbound Alberta and don't person substance refining oregon retail businesses, similar immoderate bigger oilsands players.

Late past period Strathcona announced an equity committedness missive with Waterous Energy Fund, besides led by Waterous. The money owns astir 80 per cent of Strathcona shares, and the caller concern is worthy astir $662 million.

"As portion of the offer, we are asking MEG shareholders to articulation america arsenic chap shareholders successful Strathcona and spot the Strathcona squad arsenic stewards of their capital," Waterous said connected May 30.

Inferior assets, important risks

But McFarland said Monday that the committee does not spot upside from joining up with Strathcona.

"A operation with Strathcona would exposure shareholders to inferior assets and important superior markets risks, including a $6 cardinal overhang resulting from Waterous Energy Fund's 51 per cent ownership successful the combined company, which would let WEF investors to recognize liquidity implicit time."