That's bad news for Calgary office workers as about $400 million of the savings are expected to come from "workforce optimization," along with savings from IT and procurement, said Pourbaix, though he did not explicitly say there would be job losses. In September, it said it was reviewing the project while asking for direct investment from the federal government and the province of Newfoundland and Labrador. He added about $200 million in savings will come from sharing technical expertise and the other $600 million through better use of capital by focusing on assets with higher return potential. "It is unique for the assets of two companies to complement each other this well," he said on a conference call on Sunday. The combined company will be better able to weather energy market volatility while generating more cash flow, reducing debt and cutting overall costs, said Cenovus CEO Alex Pourbaix, who will head the merged entity. Cenovus said the combined company will be able to produce 750,000 barrels of oil equivalent per day. Canadian companies have been under stress for six years, dating back to the last downturn, due to congested pipelines and the flight by foreign oil companies and investors due to Canada’s high production costs and emissions. Cenovus Energy Inc has agreed to buy rival Husky Energy Inc in an all-stock deal valued at C$3.8 billion ($2.9 billion) to create Canada's No. All quotes delayed a minimum of 15 minutes. The deal, announced on Sunday, follows recent big deals in the United States. Our Standards: The Thomson Reuters Trust Principles. "Over the past several months as we worked together on this transaction, from a value and strategic perspective, the merits and overall fit have become abundantly clear," he said on the call. Webull Financial LLC is a member of, Characteristics and Risks of Standardized Options. Relevant regulatory and exchange fees may apply. Companies in this story: (TSX:CVE, TSX:HSE), Sign in or register for your free account, The combined company will be better able to weather energy market volatility, Cenovus CEO Alex Pourbaix speaks at a news conference in Calgary on January 30, 2020. Cenovus and Husky shares have lost 63% and 70% respectively this year, exceeding the Toronto energy index loss of 53%. The combined companies are expected to be able to sustain output at about 750,000 barrels of oil equivalent per day for about $2.4 billion a year, 25 per cent less than required separately, Pourbaix said. RBC Capital Markets and TD Securities are acting as financial advisors to Cenovus, while Goldman Sachs Canada and CIBC Capital Markets are acting as financial advisors to Husky. "When you combine two companies with similar geographies and somewhat similar operations, you're always going to have some overlap ... in this case, there would probably be relatively a little more weight on the head office functions, just because we aren't quite as overlapping in the field," he said. They've also agreed to a standstill agreement under which they are subject to certain voting requirements and transfer restrictions for a maximum of five years. Husky shareholders will receive 0.7845 of a Cenovus share plus 0.0651 of a Cenovus share purchase warrant in exchange for each Husky common share. See here for a complete list of exchanges and delays. The combined company's board of directors is to be made up of eight Cenovus appointees and four from Husky. Explanatory brochure available upon request or at www.sipc.org.Our clearing firm Apex Clearing Corp has purchased an additional insurance policy. Meanwhile, Canada's Husky Energy … ", Husky CEO Rob Peabody added it's the "start of a new chapter.". THE CANADIAN PRESS/Jeff McIntosh, Saskatchewan election day: Voters go to the polls after four-week pandemic campaign, Top doctor warns severe illness likely to rise, trailing spike in COVID-19 cases. After the deal closes, Cenovus shareholders would own 61% of the combined entity, with Husky shareholders controlling the rest. Cenovus CEO Pourbaix will serve as chief executive of the merged company with Jeff Hart, currently Husky’s finance chief, becoming chief financial officer. Please read Characteristics and Risks of Standardized Options before investing in options.No content on the Webull Financial LLC website shall be considered a recommendation or solicitation for the purchase or sale of securities, options or other investment products. The deal makes Cenovus an integrated producer with refineries in Canada and the United States, adding to their existing half-ownerships in two U.S. refineries. We’re committed to maximizing value by responsibly developing … The combined company is expected to generate annual synergies of C$1.2 billion and will operate as Cenovus Energy Inc with headquarters in Alberta, Canada, the statement said. Cenovus said the deal would create Canada’s third-largest producer based on total company output behind Canadian Natural Resources Ltd and Suncor Energy Ltd. Husky shareholders will receive 0.7845 of a Cenovus share and 0.0651 of a Cenovus share purchase warrant in exchange for each Husky common share, according to the statement. © 2020 Webull Financial LLC, All rights reserved. Cenovus owns a crude-by-rail terminal northeast of Edmonton. (Reuters) - Cenovus Energy Inc has agreed to buy rival Husky Energy Inc in an all-stock deal valued at C$3.8 billion ($2.9 billion) to create Canada’s No. Options trading privileges subject to Webull Financial LLC review and approval. The merger combines Cenovus production of about 475,000 boe/d with Husky's 275,000 boe/d and their combined refining and upgrading capacity is expected to total about 660,000 barrels per day (Cenovus 250,000 bpd, Husky 410,000 bpd).
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