Canadian Oil Sands reviewing other takeover offers after rejecting Suncor's $3.23 bn bid
26 November 2015
Canadian Oil Sands is reviewing other takeover offers after it rejected a hostile C$4.3 billion ($3.23 billion) bid from Suncor Energy last month, according to a filing with the regulators.
RBC Capital Markets, which has been hired by Canadian Oil Sands to help review options, filed an affidavit to the Alberta Securities Commission, saying that "four highly credible parties" have already signed confidentiality agreements.
Suncor had last month tabled a hostile $3.23-billion takeover offer and Canadian Oil Sands reacted by adopting an extended poison pill to foil the bid.
Suncor, based in Calgary, Alberta, has filed a complaint with provincial securities regulator to get the poison pill quashed and the hearing is scheduled to be heard tomorrow.
According to several media reports, private equity firms Blackstone Group and KKR & Co and Canadian investment funds Canada Pension Plan Investment Board and Ontario Teachers' Pension Plan have shown interest in Canadian Oil Sands.
Reuters reported that two Indian oil and gas companies have also shown interest in Canadian Oil Sands, but did not name the companies.
Canadian Oil Sand's primary business operation is through its 36.74-per cent interest in Syncrude. The Calgary-based company also holds some arctic natural gas interests through a wholly owned subsidiary, Canadian Arctic Gas Ltd.
Syncrude is one of the world's largest producers of synthetic crude oil from oil sands and the largest single source producer in Canada.
Syncrude, which employs 5,000 people directly and has about 3,500 contractor employees, has current production capacity of 350,000 barrels per day of high quality light, low sulphur crude oil – enough to supply 6.2 million Canadians.
Other stakeholder in Syncrude are Imperial Oil with 25 per cent, Suncor Energy with 12 per cent, Chinese state-owned oil giants Sinopec and CNOOC with 9.03 per cent and 7.23 per cent respectively, Mocal Energy (a subsidiary of Nippon Oil Exploration) with 5 per cent, and Murphy Oil with 5 per cent.