MEG Energy has once again recommended to its shareholders that they reject the newest Strathcona Resources Ltd. offer.
The announcement was made Sept. 15, and recommended shareholders reject the revised Strathcona offer.
Read more: Strathcona Resources looks to purchase MEG Energy
Strathcona announced on Sept. 8 they were making an amended offer which according to the company would equate to $30.86 per MEG share.
Chair of the MEG board James McFarland says the new offer is a risk to shareholders.
“The Revised Strathcona Offer remains fundamentally unattractive for MEG shareholders because it fails to address or adequately compensate for the significant risks embedded in Strathcona Shares,” he said. “MEG shareholders would be exposed to inferior assets, an unproven track record, an overvalued Strathcona share price, significant overhang risk, and governance risk.
“In contrast, the Cenovus Transaction delivers an attractive price, upside potential, substantial cash, and value certainty that MEG Shareholders deserve. The Board unanimously recommends that MEG Shareholders vote for the Cenovus Transaction.”
MEG says shareholders should continue to vote for the Cenovus Energy offer which values their shares at $28.18 per share.
Strathcona responded the following today (Sept. 16) saying they were disappointed in the decision.
“Strathcona is disappointed that the MEG Board has elected to re-commit to the MEG Board Deal (with Cenovus), despite the clearly superior Amended Offer,” the company said in a press release.
Strathcona intends to vote against the Cenovus deal with its 14.2 per cent interest in MEG.
Read more: Battle over MEG ownership continues
