Suncor Energy Inc. and Petro-Canada have announced an agreement to merge the two companies. Upon completion of the transaction, the parties have agreed the combined entity will operate corporately and trade under the Suncor name, while maintaining the strong brand presence and customer loyalty of Petro-Canada in refined products.
"This merger creates a made-in-Canada energy leader with
the assets, cost structure and financial strength to compete globally,"
said Rick George, president and chief executive officer of Suncor and now the
merged entity. "The combined portfolio boasts the largest oil sands
resource position, a strong Canadian downstream brand, solid conventional
exploration and production assets, and low-cost production from Canada's east
coast and internationally."
Under the terms of the Arrangement Agreement entered into between
Suncor and Petro-Canada, the proposed merger will be effected by way of a Plan
of Arrangement completed under the Canada Business Corporations Act. It will
feature a common share exchange through which Petro-Canada common shareholders
will effectively receive 1.28 common shares of the merged company for each
common share of Petro-Canada they own and each Suncor common shareholder will
receive one common share of the merged company for each common share of Suncor
they own. The exchange ratio represents an approximate 25% premium for the
Petro-Canada shares to the 30-day weighted-average trading price of such
shares. On completion of the proposed transaction, Suncor's existing
shareholders will own approximately 60% and Petro-Canada shareholders will own
approximately 40% of the merged company.
For more information, visitwww.suncor.com/default.aspx?cid=988.