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A shareholder vote to approve Cenovus Energy Inc.’s $8.6-billion acquisition of MEG Energy Corp. is still scheduled to go ahead Thursday, despite the target company announcing a last-minute delay of a few hours to address a “regulatory inquiry.”
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Shareholders in the oilsands producer who turned up in-person or virtually for the special meeting in Calgary Thursday morning expecting either to vote or to hear the final decision announced were surprised by news of the postponement until 2 p.m. (4 p.m. Eastern).
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“I’ve made a decision to recess the meeting until 2 p.m. this afternoon in order to give us time to address a regulatory inquiry that came in late yesterday evening,” MEG chair James McFarland said Thursday before recessing the meeting without offering further detail.
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A request to MEG for comment was not immediately returned.
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A spokesperson for the Alberta Securities Commission Thursday declined to say whether it had made an inquiry to MEG, citing confidentiality provisions under Alberta’s Securities Act prohibiting the regulator from commenting on complaints or potential investigations.
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It was widely understood heading into Thursday’s meeting that MEG shareholders are broadly in favour of the acquisition by Cenovus following the announcement earlier this week of a second sweetener to the oilsands major’s stock-and-cash offer.
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Cenovus raised its price by roughly 50 cents per share and struck a side deal with rival suitor Strathcona Resources Ltd. to secure its support for the transaction.
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The deal values MEG at about $30 per share, based on Cenovus’s closing price on Oct. 24.
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Passing the deal requires approval by two-thirds of MEG shareholders, and a vote has twice been postponed amid concerns it would fall short of the required supermajority.
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The vote is expected to bring to a close a messy, months-long battle that saw Cenovus pitted against hostile rival Strathcona — MEG’s largest shareholder — for control of the pureplay oilsands producer.
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Strathcona had previously urged shareholders to reject Cenovus’s board-backed offer in favour of its own all-share bid before it dropped out of the contest earlier this month.
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