Strathcona buys $190.8M stake in MEG Energy, opposes Cenovus takeover

[Oil Production and Financial Chart]
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Strathcona Resources (TSX:SCR:CA [https://seekingalpha.com/symbol/SCR:CA]) has acquired [https://seekingalpha.com/pr/20218452-strathcona-resources-ltd-confirms-acquisition-of-additional-common-shares-of-meg-energy-corp]6,664,400 common shares of MEG Energy (OTCPK:MEGEF [https://seekingalpha.com/symbol/MEGEF]) for a total of approximately $190.8 million. The company stated that it plans to vote its MEG shares against the proposed acquisition of MEG by Cenovus Energy (CVE [https://seekingalpha.com/symbol/CVE]).

The average price paid for all MEG shares purchased by Strathcona since the commencement of the offer is $28.64 per MEG share.

The highest price paid for the MEG shares purchased by Strathcona on Tuesday was $28.80 per MEG share, and the company now owns 30,064,400 MEG shares, representing approximately 11.8% of the issued and outstanding stock.

Strathcona Resources (OTCPK:STHRF [https://seekingalpha.com/symbol/STHRF]) said last week it plans to purchase an additional 5% stake 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#hasComeFromMpArticle=false#source=section%3Amain_content%7Cbutton%3Abody_link%7Cfirst_level_url%3Anews] from Cenovus Energy (CVE [https://seekingalpha.com/symbol/CVE]).

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#hasComeFromMpArticle=false#source=section%3Amain_content%7Cbutton%3Abody_link%7Cfirst_level_url%3Anews]) 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 LTD., 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]
* Historical earnings data for Strathcona Resources Ltd. [https://seekingalpha.com/symbol/SCR:CA/earnings]
* Dividend scorecard for Strathcona Resources Ltd. [https://seekingalpha.com/symbol/SCR:CA/dividends/scorecard]