Strathcona Resources to Increase Minority Stake in MEG Energy, Vote Against Cenovus Buyout Plan

By Adriano Marchese

Strathcona Resources is moving to increase its stake in MEG energy as it looks to derail the oil-sands producer's planned 7.9 billion Canadian dollar ($5.75) sale to Cenovus Energy.

The Alberta-based energy company said Friday it intends to buy another 5% of the MEG Energy's outstanding shares, which would lift its holding to about 14.2%. Strathcona said that it will vote its enlarged position against the Cenovus acquisition after sounding out other MEG shareholders.

The tie-up requires the approval from two-thirds of the votes cast.

Cenovus Energy last week struck a deal to acquire MEG Energy in the cash-and-stock deal which represents a 33% premium to MEG's average price before rival Strathcona launched its bid in May, with a proposal that would have provided only a 9.2% premium.

At the time, MEG's board urged shareholders not to accept the deal and instead launched a strategic review of alternatives that began in mid-June as the company sought to bring an offer superior to its standalone plan.

The rivalry over acquisition targets underscores the growing consolidation in Canada's oil patch, where oil-sands assets have drawn buyers on the back of strong energy demand, geopolitical tensions and supply cuts by the Organization of the Petroleum Exporting Countries and allies.

Write to Adriano Marchese at adriano.marchese@wsj.com

(END) Dow Jones Newswires

August 29, 2025 11:07 ET (15:07 GMT)