By The Canadian Press
Updated: October 27, 2025
Cenovus Energy logos are on display at the Global Energy Show in Calgary, Alta.
THE CANADIAN PRESS/Jeff McIntosh
CALGARY — Cenovus Energy Inc.’s takeover of MEG Energy Corp. appears poised to win shareholder approval later this week after the oilsands giant raised what it had said was its “best and final” offer and secured the support of one-time rival Strathcona Resources Ltd.
“Heading into this week, we thought there was going to be the potential for some fireworks,” said Patrick O’Rourke, managing director of institutional equity research at ATB Capital Markets.
Monday’s news “probably gave most a sense that this transaction should be able to get across the goal line,” he added.
The sweetened offer, made up of half cash and half stock, is worth $30 per share based on Cenovus’ closing stock price on Friday. Earlier, it had offered $29.50 in cash or 1.240 of a Cenovus share, worth $29.65 as of Friday.
MEG shareholders are to vote on the offer, which has the support of that company’s board, on Thursday. The meeting had been scheduled for last week, but was delayed after it appeared the approval vote might have fallen short of the required two-thirds majority.
But Strathcona, which recently dropped its own hostile all-stock offer for MEG, now says it intends to vote its 14.2 per cent stake in favour of the new Cenovus bid.
“With Strathcona’s support, MEG currently expects that approximately 79 per cent of the MEG shares represented by proxy or expected to be voted in person at the meeting are for the approval of the improved Cenovus transaction,” MEG said in a statement.
Strathcona executive chairman Adam Waterous declined to comment further on Monday.
Cenovus and MEG have side-by-side oilsands properties at Christina Lake, south of Fort McMurray, Alta., and the companies have touted the cost-savings and efficiencies that would result from joining forces. Strathcona also has steam-driven operations in the region.
“We’ve got a pretty high degree of confidence in (Cenovus’) ability to operate these assets, given the results we’ve seen at their offsetting Christina Lake property,” said O’Rourke.
“I think that the outlook for the combined asset and achieving the synergies they’ve noted is pretty reasonable.”
The deal would add 110,000 barrels of daily oilsands production to Cenovus’ portfolio, bringing it to 720,000 boe/d. Cenovus has said output could grow to 850,000 boe/d in 2028.
Also Monday, Cenovus announced the sale of its Vawn thermal heavy oil operation in Saskatchewan and certain undeveloped land in western Saskatchewan and Alberta to Strathcona for $150 million including $75 million in cash paid on closing and up to $75 million more, depending on future commodity prices.
At about 5,000 boe/d, the properties are more meaningful to a smaller company like Strathcona than they are to Cenovus, where they would not get a lot of attention, said O’Rourke.
He noted that at one point, the assets achieved more than twice that level of production.
“So we know that there’s latent facility capacity there and the ability to increase the efficiencies.”
This is the second time Cenovus improved its offer after asserting it wouldn’t. Its initial bid was made up of 75 per cent cash and 25 per cent equity and had an implied value of $28.48 before it was sweetened on Oct. 8.
The saga began in April when Strathcona approached the MEG board with a cash-and-stock takeover bid. Strathcona was rebuffed and took the offer directly to MEG shareholders weeks later.
In June, MEG’s board called the bid “opportunistic” and urged shareholders to reject it as it launched a review to find a superior offer. Waterous had accused MEG of refusing to engage and taking an “anyone but Strathcona” stance.
In August, MEG announced its board had accepted the first friendly takeover offer from Cenovus. The following month, Strathcona amended its offer to be based entirely on stock, arguing that structure would give investors greater opportunity to benefit from future growth.
Cenovus upped its bid and offered a greater equity share in early October, and the companies agreed to allow Cenovus to buy up to 9.9 per cent of the target company’s stock ahead of the shareholder vote.
Strathcona abandoned its bid a few days later, saying the conditions of its offer could no longer be satisfied, while some MEG shareholders decried what they saw as unfair tactics to lock up the deal with Cenovus.
This report by The Canadian Press was first published Oct. 27, 2025.
CALGARY — Cenovus Energy Inc.’s takeover of MEG Energy Corp. appears poised to win shareholder approval later this week after the oilsands giant raised what it had said was its “best and final” offer and secured the support of one-time rival Strathcona Resources Ltd.
“Heading into this week, we thought there was going to be the potential for some fireworks,” said Patrick O’Rourke, managing director of institutional equity research at ATB Capital Markets.
Monday’s news “probably gave most a sense that this transaction should be able to get across the goal line,” he added.
The sweetened offer, made up of half cash and half stock, is worth $30 per share based on Cenovus’ closing stock price on Friday. Earlier, it had offered $29.50 in cash or 1.240 of a Cenovus share, worth $29.65 as of Friday.
MEG shareholders are to vote on the offer, which has the support of that company’s board, on Thursday. The meeting had been scheduled for last week, but was delayed after it appeared the approval vote might have fallen short of the required two-thirds majority.
But Strathcona, which recently dropped its own hostile all-stock offer for MEG, now says it intends to vote its 14.2 per cent stake in favour of the new Cenovus bid.
“With Strathcona’s support, MEG currently expects that approximately 79 per cent of the MEG shares represented by proxy or expected to be voted in person at the meeting are for the approval of the improved Cenovus transaction,” MEG said in a statement.
Strathcona executive chairman Adam Waterous declined to comment further on Monday.
Cenovus and MEG have side-by-side oilsands properties at Christina Lake, south of Fort McMurray, Alta., and the companies have touted the cost-savings and efficiencies that would result from joining forces. Strathcona also has steam-driven operations in the region.
“We’ve got a pretty high degree of confidence in (Cenovus’) ability to operate these assets, given the results we’ve seen at their offsetting Christina Lake property,” said O’Rourke.
“I think that the outlook for the combined asset and achieving the synergies they’ve noted is pretty reasonable.”
The deal would add 110,000 barrels of daily oilsands production to Cenovus’ portfolio, bringing it to 720,000 boe/d. Cenovus has said output could grow to 850,000 boe/d in 2028.
Also Monday, Cenovus announced the sale of its Vawn thermal heavy oil operation in Saskatchewan and certain undeveloped land in western Saskatchewan and Alberta to Strathcona for $150 million including $75 million in cash paid on closing and up to $75 million more, depending on future commodity prices.
At about 5,000 boe/d, the properties are more meaningful to a smaller company like Strathcona than they are to Cenovus, where they would not get a lot of attention, said O’Rourke.
He noted that at one point, the assets achieved more than twice that level of production.
“So we know that there’s latent facility capacity there and the ability to increase the efficiencies.”
This is the second time Cenovus improved its offer after asserting it wouldn’t. Its initial bid was made up of 75 per cent cash and 25 per cent equity and had an implied value of $28.48 before it was sweetened on Oct. 8.
The saga began in April when Strathcona approached the MEG board with a cash-and-stock takeover bid. Strathcona was rebuffed and took the offer directly to MEG shareholders weeks later.
In June, MEG’s board called the bid “opportunistic” and urged shareholders to reject it as it launched a review to find a superior offer. Waterous had accused MEG of refusing to engage and taking an “anyone but Strathcona” stance.
In August, MEG announced its board had accepted the first friendly takeover offer from Cenovus. The following month, Strathcona amended its offer to be based entirely on stock, arguing that structure would give investors greater opportunity to benefit from future growth.
Cenovus upped its bid and offered a greater equity share in early October, and the companies agreed to allow Cenovus to buy up to 9.9 per cent of the target company’s stock ahead of the shareholder vote.
Strathcona abandoned its bid a few days later, saying the conditions of its offer could no longer be satisfied, while some MEG shareholders decried what they saw as unfair tactics to lock up the deal with Cenovus.
This report by The Canadian Press was first published Oct. 27, 2025.
Investor Outlook: Parkland profit climbs as Sunoco takeover nears completion
By BNN Bloomberg
Published: October 27, 2025
Ernest Wong, head of research at Baskin Wealth Management, joins BNN Bloomberg to discuss the impact of the Parkland-Sunoco deal on M&A.
Parkland posted a rise in third-quarter profit as it prepares to finalize its acquisition by U.S.-based Sunoco. The Calgary fuel and convenience retailer, which owns brands such as Ultramar, Chevron and Pioneer, said the transaction is set to close by Oct. 31.
BNN Bloomberg spoke with Ernest Wong, head of research at Baskin Wealth Management, who said the results were largely overshadowed by the pending deal. He added that the transaction signals a broader wave of consolidation in the fuel and retail space and shows promise for future foreign investment in Canada’s energy sector.
Key TakeawaysParkland’s third-quarter profit rose as it prepares to finalize its sale to Sunoco by Oct. 31.
Few Parkland shareholders chose to take Sunoco stock due to unfavourable U.S. tax treatment.
The deal highlights ongoing consolidation in the fuel and convenience store sector, leaving Couche-Tard as Canada’s key consolidator.
Wong said the fast regulatory process and commitments to Calgary jobs signal investor confidence in Canada.
The smooth approval could encourage more cross-border mergers in Canada’s energy and resource industries.
By BNN Bloomberg
Published: October 27, 2025
Ernest Wong, head of research at Baskin Wealth Management, joins BNN Bloomberg to discuss the impact of the Parkland-Sunoco deal on M&A.
Parkland posted a rise in third-quarter profit as it prepares to finalize its acquisition by U.S.-based Sunoco. The Calgary fuel and convenience retailer, which owns brands such as Ultramar, Chevron and Pioneer, said the transaction is set to close by Oct. 31.
BNN Bloomberg spoke with Ernest Wong, head of research at Baskin Wealth Management, who said the results were largely overshadowed by the pending deal. He added that the transaction signals a broader wave of consolidation in the fuel and retail space and shows promise for future foreign investment in Canada’s energy sector.
Key TakeawaysParkland’s third-quarter profit rose as it prepares to finalize its sale to Sunoco by Oct. 31.
Few Parkland shareholders chose to take Sunoco stock due to unfavourable U.S. tax treatment.
The deal highlights ongoing consolidation in the fuel and convenience store sector, leaving Couche-Tard as Canada’s key consolidator.
Wong said the fast regulatory process and commitments to Calgary jobs signal investor confidence in Canada.
The smooth approval could encourage more cross-border mergers in Canada’s energy and resource industries.
Ernest Wong, head of research at Baskin Wealth Management
Read the full transcript below:
LINDSAY: Parkland has reported its third-quarter profit is up from a year ago as it prepares to complete its deal to be acquired by Sunoco. Calgary-based Parkland owns the Ultramar, Chevron and Pioneer gas station chains, as well as several other brands in 26 countries. For more on this, we’re joined by Ernest Wong, head of research at Baskin Wealth Management.
It’s good to have you. Thanks for taking the time.
ERNEST: Thanks for having me.
LINDSAY: So, beating expectations. But do the results really matter? Are they noteworthy, given this deal that’s going to go through soon?
ERNEST: Well, I think the market liked the results, and you’re seeing that reflected in the stock price of Sunoco. Given that a large chunk of this deal involves Parkland shareholders receiving Sunoco stock, that’s probably why you’re also seeing Parkland shares move up.
The one thing that was notable was that we now have clarity about when the deal will close — by Oct. 31. At that point, Parkland will cease to exist as a standalone company.
LINDSAY: So we’re getting more details on the deal. What stands out to you between these two companies?
ERNEST: What’s interesting is that there was very limited interest among Parkland shareholders in taking Sunoco Corp. units as part of the deal. That makes sense, given that most Parkland investors owned it for the dividend and have little interest in holding a U.S. dividend taxed at an unfavourable rate.
If we zoom out, this is part of a broader consolidation trend in the fuel distribution and convenience store space. In Canada, Alimentation Couche-Tard is now the only major consolidator left in the sector.
LINDSAY: Do you think Parkland’s deal with Sunoco is good for Canada?
ERNEST: Yes, I think it’s good news for investment in Canada. The regulatory process was very quick — shareholders approved the deal in June, Investment Canada Act approval came in October, and now it’s closing by the end of the month.
Initially, there were concerns about an American company acquiring strategic assets such as the Burnaby refinery and Canadian gas stations. But Sunoco committed to maintaining investment in the refinery and keeping its headquarters and jobs in Calgary. The quick approval process is encouraging and bodes well for future investment in Canada.
LINDSAY: We’re also seeing trade tensions between the U.S. and Canada. Could that weigh on this deal?
ERNEST: Maybe a little, but overall, we’ve been encouraged by what the prime minister has said about promoting investment in Canada — especially in diversifying markets for oil and gas. Over the weekend, Prime Minister Mark Carney met with Petronas to discuss investments for phase two of LNG Canada. That’s another positive sign for the energy sector.
LINDSAY: Do you think this deal could encourage more mergers and acquisitions in Canada?
ERNEST: Yes, especially given that most M&A activity in the commodity space has involved Canadian companies buying each other. A U.S. company being able to acquire a Canadian firm with a smooth approval process bodes well for foreign investment in the energy sector going forward.
LINDSAY: What about more mergers in the gas station and convenience store space?
ERNEST: In Canada, that sector is already quite consolidated, so we’re unlikely to see many large deals here. It’s a different story in the U.S., where the market is more fragmented. We own Alimentation Couche-Tard partly because it’s been a strong consolidator in the U.S. gas station space, and there’s still room for more growth there.
LINDSAY: Interesting. Ernest Wong, head of research at Baskin Wealth Management, appreciate your time. Thanks for joining us.
---
This BNN Bloomberg summary and transcript of the Oct. 27, 2025 interview with Ernest Wong are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
Read the full transcript below:
LINDSAY: Parkland has reported its third-quarter profit is up from a year ago as it prepares to complete its deal to be acquired by Sunoco. Calgary-based Parkland owns the Ultramar, Chevron and Pioneer gas station chains, as well as several other brands in 26 countries. For more on this, we’re joined by Ernest Wong, head of research at Baskin Wealth Management.
It’s good to have you. Thanks for taking the time.
ERNEST: Thanks for having me.
LINDSAY: So, beating expectations. But do the results really matter? Are they noteworthy, given this deal that’s going to go through soon?
ERNEST: Well, I think the market liked the results, and you’re seeing that reflected in the stock price of Sunoco. Given that a large chunk of this deal involves Parkland shareholders receiving Sunoco stock, that’s probably why you’re also seeing Parkland shares move up.
The one thing that was notable was that we now have clarity about when the deal will close — by Oct. 31. At that point, Parkland will cease to exist as a standalone company.
LINDSAY: So we’re getting more details on the deal. What stands out to you between these two companies?
ERNEST: What’s interesting is that there was very limited interest among Parkland shareholders in taking Sunoco Corp. units as part of the deal. That makes sense, given that most Parkland investors owned it for the dividend and have little interest in holding a U.S. dividend taxed at an unfavourable rate.
If we zoom out, this is part of a broader consolidation trend in the fuel distribution and convenience store space. In Canada, Alimentation Couche-Tard is now the only major consolidator left in the sector.
LINDSAY: Do you think Parkland’s deal with Sunoco is good for Canada?
ERNEST: Yes, I think it’s good news for investment in Canada. The regulatory process was very quick — shareholders approved the deal in June, Investment Canada Act approval came in October, and now it’s closing by the end of the month.
Initially, there were concerns about an American company acquiring strategic assets such as the Burnaby refinery and Canadian gas stations. But Sunoco committed to maintaining investment in the refinery and keeping its headquarters and jobs in Calgary. The quick approval process is encouraging and bodes well for future investment in Canada.
LINDSAY: We’re also seeing trade tensions between the U.S. and Canada. Could that weigh on this deal?
ERNEST: Maybe a little, but overall, we’ve been encouraged by what the prime minister has said about promoting investment in Canada — especially in diversifying markets for oil and gas. Over the weekend, Prime Minister Mark Carney met with Petronas to discuss investments for phase two of LNG Canada. That’s another positive sign for the energy sector.
LINDSAY: Do you think this deal could encourage more mergers and acquisitions in Canada?
ERNEST: Yes, especially given that most M&A activity in the commodity space has involved Canadian companies buying each other. A U.S. company being able to acquire a Canadian firm with a smooth approval process bodes well for foreign investment in the energy sector going forward.
LINDSAY: What about more mergers in the gas station and convenience store space?
ERNEST: In Canada, that sector is already quite consolidated, so we’re unlikely to see many large deals here. It’s a different story in the U.S., where the market is more fragmented. We own Alimentation Couche-Tard partly because it’s been a strong consolidator in the U.S. gas station space, and there’s still room for more growth there.
LINDSAY: Interesting. Ernest Wong, head of research at Baskin Wealth Management, appreciate your time. Thanks for joining us.
---
This BNN Bloomberg summary and transcript of the Oct. 27, 2025 interview with Ernest Wong are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
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