Cenovus Energy Inc. agreed to buy Athabasca Oil Corp. at an enterprise value of C$5.7 billion, or $4 billion, the latest in a wave of consolidation as Canada's government seeks to grow energy production. The cash and share takeover would add about 45,000 barrels of oil equivalent a day to Cenovus's output and give it significant potential for further growth, according to the statement. The per-share value represents a 13% premium to Athabasca's closing price on Oct. 2. The cash portion, accounting for 65% to 75% of the transaction, will be funded with cash on hand and certain short-term borrowings, and Cenovus's financial framework and net-debt target of $4 billion remain unchanged. The deal has been unanimously approved by the boards of both companies and is expected to close in December, pending approvals from regulators and Athabasca shareholders, the company said. Cenovus president and chief executive officer Jon McKenzie said the transaction strengthens the company's position in one of the world's premier oil-producing regions and is a natural extension of its oil sands strategy.
Cenovus Energy IncCenovus agreed to acquire Athabasca Oil for C$5.7B, adding ~45,000 boe/d of output and growth potential.
