Strathcona to buy 5% stake in MEG Energy after failed bid, opposes Cenovus deal

[Pumpjack Silhouette on the Great Plains in Alberta]
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Strathcona Resources (OTCPK:STHRF [https://seekingalpha.com/symbol/STHRF]) said late Thursday it plans to purchase an additional 5% stake [https://seekingalpha.com/pr/20215579-strathcona-resources-ltd-announces-intention-to-purchase-additional-common-shares-of-meg] in MEG Energy (OTCPK:MEGEF [https://seekingalpha.com/symbol/MEGEF]) after its hostile bid for the company was spurned in favor of a friendly cash-and-stock offer [https://seekingalpha.com/news/4488255-cenovus-energy-to-buy-meg-energy-in-c79b-deal-topping-strathcona-bid] from Cenovus Energy (CVE [https://seekingalpha.com/symbol/CVE]).

Strathcona (OTCPK:STHRF [https://seekingalpha.com/symbol/STHRF]), which currently holds ~9.2% of MEG Energy (OTCPK:MEGEF [https://seekingalpha.com/symbol/MEGEF]), said it would increase its ownership to ~14.2%, and said it intends to vote against an upcoming resolution to approve Cenovus' (CVE [https://seekingalpha.com/symbol/CVE]) $7.9B deal to acquire MEG, which requires approval by at least two-thirds of votes cast by MEG shareholders at a special meeting scheduled to be held on October 9.

The Cenovus-MEG Energy combination would create one of the largest oil sands companies in Canada, combining MEG's (OTCPK:MEGEF [https://seekingalpha.com/symbol/MEGEF]) Christina Lake oil sands operations in Alberta with Cenovus' (CVE [https://seekingalpha.com/symbol/CVE]) neighboring assets, raising its total oil sands production to 720K bbl/day, growing to 850K bbl/day in 2028.

MORE ON STRATHCONA RESOURCES AND MEG ENERGY

* Cenovus Energy: Thanks For Paying In Cash [https://seekingalpha.com/article/4816300-cenovus-energy-thanks-for-paying-in-cash]
* Cenovus And MEG Energy: Great Deal [https://seekingalpha.com/article/4816181-cenovus-and-meg-energy-great-deal]
* Strathcona Resources: MEG Energy Or A $10 Dividend? Cenovus Holds The Answer [https://seekingalpha.com/article/4814872-strathcona-resources-meg-energy-or-10-dividend-cenovus-holds-answer]