MEG Energy (TSX: MEG) has been forced to delay a shareholder vote related to seeking approval for a combination with Cenovus Energy (TSX: CVE). The company disclosed this morning that it has so far failed to secure the approval required to proceed.
The company indicated this morning that so far of the votes received, 63% of the MEG shares have voted in favour of the transaction, which falls short of the 66⅔% required for the transaction to proceed. As a result, the company has delayed the shareholder meeting to Thursday, October 30 in an effort to secure further shareholder approval.
The latest offer from Cenovus amounts to consideration of $29.52 per common share of MEG based on Monday’s closing prices, valuing the company at $8.5 billion, including assumed debt, or about $79,000 per bpd. The current offer represents a 44% premium to MEG’s price as of May 15, which was the day before Strathcona Resources (TSX: SCR) began a hostile takeover attempt.
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Consideration under the transaction, on a pro-rated basis, amounts to $14.75 in cash and 0.62 of a Cenovus share. Strathcona meanwhile cancelled its bid for MEG Energy following this latest revised offer from Cenovus coming through.
MEG Energy last traded at $29.27 on the TSX.
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