Husky makes a hostile bid of 3.3 billion dollars for MEG Energy

Husky Energy Inc. makes a hostile takeover bid of $ 3.3 billion for oil sand producer MEG Energy Corp.

In a statement released on Sunday, Husky said it would pay $ 11 in cash or 0.485 Husky shares for each MEG share, a premium of 37 percent premium to the closing price of MEG of $ 8.03 on Friday. It also assumes MEG & # 39; s debt of $ 3 billion.

"Husky is confident that the proposed transaction is in the best interest of Husky and MEG shareholders, employees and stakeholders," said Husky CEO Rob Peabody in a press Sunday.

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"So far, however, MEG's board of directors has refused to enter into a discussion about the benefits of a transaction, which gives us no choice but to bring this offer directly to the shareholders of MEG."

The company has scheduled a conference call for Monday morning before the markets open.

The combined company would have a total production of more than 410,000 barrels of oil equivalent per day and refine and improve the capacity of approximately 400,000 barrels per day.

Husky focuses on the production of heavy oil in western Canada, but is also a partner in offshore projects outside of Newfoundland and Labrador. MEG operates in the oil sands with its Christina Lake and Surmont in situ projects.

"Husky continues to implement our five-year plan – maintaining a strong balance sheet, lowering our cost structure, increasing our production and margins and improving our ability to generate free cash flow – we are uniquely positioned to deliver great value to MEG shareholders," Mr. Peabody said.

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