OPTI Canada to be acquired by China's CNOOC in $2.1bn deal
Junior oil sands developer OPTI Canada (TSE:OPC), which last week filed for bankruptcy protection, announced Wednesday it will be acquired by China National Offshore Oil Corp (CNOOC), a subsidiary of China's CNOOC (NYSE:CEO), in a transaction valued at $2.1 billion.
The agreement values OPTI's equity at $34 million, with CNOOC taking on $2 billion in debt.
The Alberta-based company, whose board of directors has voted unanimously in favour of the deal, will receive $34 million for all its existing issued and outstanding common shares, equal to $0.12 per share. China's largest producer of offshore crude oil will also pay $825 million and $1.179 billion to holders of OPTI's First and Second Lien Notes, respectively, and $37.5 million to backstop parties.
OPTI, whose stock has slipped more than 90% over the last year, to $0.115 as of close on July 12 when shares stopped trading, currently holds a 35% working interest in several oil sands properties in the Athabasca oil sands play. However, only the Long Lake property is producing, with only 30,000 barrels of bitumen per day as of May, when OPTI and Nexen, which holds the remaining 65%, aimed to produce between 40,000 and 60,000 barrels per day.
Still, the acquisition will expand CNOOC's presence in Canada as more and more foreign companies look to bulk up their resources. "CNOOC Limited is a technically experienced and well-capitalized company that is equipped to support further development at Long Lake and future expansions in the Canadian oil sands," said OPTI president and CEO, Chris Slubicki.
CNOOC CEO, Yang Hua, commented: "The transaction strengthens our Canadian presence in the oil sands business." Also, "We believe that upside potential of the assets will facilitate local energy supply and our production growth in the long term." Two thirds of the holders of OPTI's Second Lien Notes must vote in favour of the deal for it to go through. The company has already received support from holders totaling 55% of the notes.
The transaction, which is expected to close in the fourth quarter, is not subject to a shareholder vote, but must receive approval from regulatory boards in China and Canada. CNOOC's stock on the New York Stock Exchange dropped 4.07% before the bell, trading at $225.25 per share.
OPTI Canada to be acquired by China's CNOOC in $2.1bn deal - Proactiveinvestors (NA)
Junior oil sands developer OPTI Canada (TSE:OPC), which last week filed for bankruptcy protection, announced Wednesday it will be acquired by China National Offshore Oil Corp (CNOOC), a subsidiary of China's CNOOC (NYSE:CEO), in a transaction valued at $2.1 billion.
The agreement values OPTI's equity at $34 million, with CNOOC taking on $2 billion in debt.
The Alberta-based company, whose board of directors has voted unanimously in favour of the deal, will receive $34 million for all its existing issued and outstanding common shares, equal to $0.12 per share. China's largest producer of offshore crude oil will also pay $825 million and $1.179 billion to holders of OPTI's First and Second Lien Notes, respectively, and $37.5 million to backstop parties.
OPTI, whose stock has slipped more than 90% over the last year, to $0.115 as of close on July 12 when shares stopped trading, currently holds a 35% working interest in several oil sands properties in the Athabasca oil sands play. However, only the Long Lake property is producing, with only 30,000 barrels of bitumen per day as of May, when OPTI and Nexen, which holds the remaining 65%, aimed to produce between 40,000 and 60,000 barrels per day.
Still, the acquisition will expand CNOOC's presence in Canada as more and more foreign companies look to bulk up their resources. "CNOOC Limited is a technically experienced and well-capitalized company that is equipped to support further development at Long Lake and future expansions in the Canadian oil sands," said OPTI president and CEO, Chris Slubicki.
CNOOC CEO, Yang Hua, commented: "The transaction strengthens our Canadian presence in the oil sands business." Also, "We believe that upside potential of the assets will facilitate local energy supply and our production growth in the long term." Two thirds of the holders of OPTI's Second Lien Notes must vote in favour of the deal for it to go through. The company has already received support from holders totaling 55% of the notes.
The transaction, which is expected to close in the fourth quarter, is not subject to a shareholder vote, but must receive approval from regulatory boards in China and Canada. CNOOC's stock on the New York Stock Exchange dropped 4.07% before the bell, trading at $225.25 per share.
OPTI Canada to be acquired by China's CNOOC in $2.1bn deal - Proactiveinvestors (NA)
