Strathcona Resources Ltd. is making a takeover stock-and-cash offer for oilsands producer MEG Energy Corp. that values the company at about $5.9 billion.
The offer comes after Strathcona, which already owns about a 9.2% stake in MEG, says it sent a takeover offer to the MEG board of directors in April, but was rejected earlier this week.
“Strathcona respects the MEG board’s right to dismiss any offer made for MEG, and it has no reason to believe that its decision to dismiss Strathcona’s proposal was not made in good faith,” the company said in a news release.
“However, Strathcona believes the benefits of a combination of Strathcona and MEG are significant enough that MEG shareholders should have the opportunity to decide for themselves.”
MEG said Friday that its board of directors will consider and evaluate the Strathcona offer once it has been received and urged shareholders to take no action until it has made a recommendation.
Strathcona is offering 0.62 of a Strathcona share and $4.10 in cash per MEG share in the proposal worth $23.27 per MEG share based on the closing price of its shares on Thursday.
MEG shares closed at $21.30 on the Toronto Stock Exchange on Thursday.
Strathcona said it is ready to engage with the MEG board and would also support a strategic alternatives process to determine if a superior transaction is available.
“Strathcona would be willing to participate constructively and in good faith in such a process, including signing a mutual confidentiality agreement to share non-public information, provided it is not required to sign a standstill agreement,” the company said.
Strathcona said a combination with MEG would create Canada’s fifth largest oil producer and fourth largest steam-assisted gravity drainage producer, with among the largest proved oil reserves in North America.
It said it has identified $175 million in annual synergy opportunities, including $50 million in overhead reduction costs, if the deal goes ahead.
On Wednesday, Strathcona announced a series of three agreements to sell its assets in the Montney region valued at a total of $2.84 billion in a move that will make it a pure-play heavy oil company.
It also said it has bought the Hardisty crude-by-rail terminal in Alberta for about $45 million.
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HUB International Ltd. has announced a minority common equity investment in the firm of close to US$1.6 billion. New and existing investors are in on the deal.
“Our ongoing investments in innovation, proprietary products, and strategic M&A, along with our commitment to learning and development, has led to consistent performance and strength in our organic growth and new business generation,” said Marc Cohen, chairman and CEO of HUB International.
Hellman & Friedman retains its controlling interest in HUB. The deal raises the company’s valuation to US$29 billion.
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PSP Investments and BCE have launched Network FiberCo, a partnership that will develop fibre infrastructure in underserved U.S. markets. PSP Investments has committed more than US$1.5 billion to the venture.
“Today’s announcement represents a pivotal step in BCE’s fibre growth strategy,” sad Mirko Bibic, president and CEO of BCE and Bell Canada. “[W]e are creating a scalable, capital-efficient platform to fund U.S. fibre footprint expansion. This strategic partnership will improve free cash flow generation and strengthen EBITDA accretion over the long term.”
BCE holds a 49% equity stake in the venture, through its Ziply Fiber business. PSP Investments holds 51%.
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CDPQ and Nuveen, the investment management arm of TIAA, have granted a $903-million credit facility to Redaptive, a U.S. energy-as-a-service provider.
“This new credit facility is a vote of confidence in both our team and our mission,” said Matt Gembrin, CFO at Redaptive. “Enterprises are under increasing pressure to modernize their infrastructure while staying financially agile.”
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Hedge fund manager Polar Asset Management Partners Inc. has acquired Castlefield Associates Inc., a relative value systematic futures hedge fund launched in 2019 by Ontario Teachers’ Pension Plan veteran Chris Schindler.
“We are pleased to welcome Chris and the Castlefield team to Polar,” said Greg Lemaich, president and CEO of Polar. “We have closely followed Castlefield’s development over the past six years and believe they have developed a unique systematic offering.”
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MNP has purchased Johnston Beaudette Chartered Professional Accountants in Cornwall, Ont. The firm’s Josée Payette will join MNP as a partner. This is MNP’s seventh investment in the region.
“We are thrilled to welcome Josée and her team to the MNP family,” said Jared Bourne, executive vice-president, Ontario outside GTA at MNP. “Our growth in Eastern Ontario has been strong and steady, and we have always been deliberate in selecting firms who align with our culture and values to join us.”