Cenovus Boosts MEG Energy Bid, Touts Record Production
Revised offer increases price and equity component to win shareholder support, announced alongside strong Q3 operational results.
Cenovus Energy (CVE) has sweetened its offer to acquire rival MEG Energy, announcing an amended agreement with a higher price and a greater share component in a move to secure shareholder approval for the blockbuster deal. The revised terms were strategically unveiled alongside an operational update revealing record third-quarter upstream production, signaling a position of strength as the company moves to consolidate its position in the Canadian oil sands.
The , a notable increase from the initial bid. Under the amended terms, MEG shareholders can elect to receive either $29.50 in cash or 1.240 Cenovus common shares for each MEG share they hold. The revised structure shifts the consideration to an approximate 50-50 split between cash and stock, a significant change from the original offer's 75% cash weighting.
This adjustment appears to be a direct response to investor feedback. "While we received support from the majority of MEG’s shareholders for our transaction, many of them indicated they would prefer greater Cenovus share consideration," said Jon McKenzie, Cenovus President & CEO. The change allows MEG investors to retain a larger stake in the combined entity, which is poised to benefit from significant operational synergies and cost savings projected to exceed C$400 million annually.
Proxy advisory firm Institutional Shareholder Services (ISS) had previously offered "cautionary support" for the original deal, noting that the small equity component was a concern. The new terms directly address this issue, likely paving the way for broader investor acceptance. To accommodate the changes, the special meeting for MEG shareholders to vote on the transaction has been postponed to October 22, 2025.
Underscoring the company's strong standalone performance, Cenovus also reported . This robust operational result provides a powerful backdrop to the acquisition talks, highlighting the value and efficiency Cenovus brings to the proposed merger. With key regulatory approvals already in hand, the company's sweetened, final offer and strong operating momentum place it in a commanding position to close the landmark transaction.