Cenovus Energy raises offer for MEG Energy amid takeover battle

Core Viewpoint - Cenovus Energy has increased its bid for MEG Energy to C$8.6 billion, including debt, amid a competitive takeover battle with Strathcona Resources, with the revised bid valuing MEG at approximately C$29.80 per share, which Cenovus claims is its "best and final" offer [1][2]. Group 1: Bid Details - Cenovus's latest offer represents a shift from an earlier structure of 75% cash and 25% stock to a 50-50 split of cash and shares, aimed at providing MEG investors with more potential upside in the combined company [3]. - Strathcona Resources' previous offer valued MEG at C$30.86 per share, indicating a competitive landscape for the acquisition [1][2]. Group 2: Shareholder Response - Despite Strathcona owning 14% of MEG, Cenovus's board has urged shareholders to reject Strathcona's bid, labeling it as "fundamentally unattractive," while MEG's board has reaffirmed its support for Cenovus's offer [2]. - The shareholder meeting for MEG has been postponed to October 22 from October 9 to allow investors more time to review the amended proposal [4]. Group 3: Strategic Importance - The acquisition battle underscores the strategic significance of MEG's Christina Lake oil sands project, known for its long reserve life, low operating costs, and production growth potential [3]. - A successful acquisition would enhance Cenovus's position as a major operator in Alberta's Christina Lake region, where MEG produces approximately 100,000 barrels of crude oil per day [4]. Group 4: Production Information - Cenovus reported upstream production of around 832,000 barrels of oil equivalent per day (boepd) in the third quarter of 2025 [5].