Cenovus Energy Inc. (TSX:CVE) has successfully completed its acquisition of Gear Energy Ltd. (TSX:GXE) in a deal worth approximately CAD 160 million. The transaction, which was first announced on December 1, 2024, has received all necessary approvals, including those from regulatory bodies, courts, and shareholders of both companies.
As part of the agreement, Gear Energy shareholders had the option to receive either CAD 0.607 in cash, 0.3035 common shares in Newco (Lotus Creek), or a combination of both. However, due to the high demand for cash consideration, adjustments were made to the payment structure. Shareholders who elected to receive 100% cash will receive approximately CAD 0.449 in cash and 0.079 of a Lotus Creek Share for each Gear Share held.
The acquisition includes all of Gear's heavy oil assets, except for its Tucker Lake property, which was transferred to Lotus Creek along with the company's light oil assets in Central Alberta and Southeast Saskatchewan. The deal is expected to enhance Cenovus Energy's portfolio and increase its presence in the oil and gas industry.
Key Points:
- Cenovus Energy Inc. acquires Gear Energy Ltd. for CAD 160 million
- Gear Energy shareholders receive cash, shares, or a combination of both
- Adjustments made to payment structure due to high demand for cash consideration
- Acquisition includes most of Gear's heavy oil assets and other properties
- Deal expected to enhance Cenovus Energy's portfolio and industry presence
If we can maintain a good result then it is a good buy else hold
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