- After recently securing regulatory approval, Cenovus Energy (CVE) has completed its buyout of Husky Energy in a deal worth roughly C$3.8 billion
- According to the terms of the deal, Husky shareholders received 0.7845 of a Cenovus share plus 0.0651 of a share purchase warrant in exchange for each Husky share held
- This gives Cenovus a total holding in Husky Energy of approximately 61 per cent
- With the deal complete, the combined entity will continue to operate as Cenovus Energy out of its headquarters in Calgary, Alberta
- Cenovus Energy is currently up 0.39 per cent to $7.78 per share
After recently securing regulatory approval, Cenovus Energy (CVE) has completed its buyout of Husky Energy in a deal worth roughly C$3.8 billion.
According to the terms of the deal, which were announced on October 31, 2020, Husky shareholders received 0.7845 of a Cenovus share plus 0.0651 of a share purchase warrant in exchange for each Husky share held.
As a result, Cenovus holds a total interest in Husky of approximately 61 per cent, creating Canada’s third largest oil and natural gas producer.
Based on last year’s figures, Cenovus produces 475,000 barrels of oil per day, while Husky produces 275,000. The resulting company is estimated to produce a total of 750,000 barrels per day, with an upgrading and refining capacity of 660,000 barrels per day.
“With the closing of this transaction, we will focus on safely and efficiently integrating the assets and teams of these two great companies while working to realise the $1.2 billion in synergies we’ve identified,” said Alex Pourbaix, President and CEO of Cenovus Energy.
“These cost and capital efficiencies, combined with our strong portfolio of well-matched upstream production, midstream and downstream assets as well as improved financial strength, are expected to generate strong value for our shareholders,” he added.
Alex will remain as CEO of Cenovus while Jeff Hart, the current financial chief of Husky, will act as Chief Financial Officer. The Board of Directors will also be amended to consist of eight members in total – four from Cenovus and four from Husky.
With the deal complete, the combined entity will continue to operate as Cenovus Energy out of its headquarters in Calgary, Alberta, while shares in Husky will be de-listed from the Toronto Stock Exchange at the close of trading on January 5.
“This is truly one of the most significant developments in the history of our two companies, and in the history of the Canadian energy industry, for that matter,” Alex concluded.
Cenovus Energy is currently up 0.39 per cent to $7.78 per share at 9:45am EST.
