Cenovus Energy Boosts MEG Energy Stake to 9.8% Amid Rival Offer Withdrawal

Cenovus Energy Inc. has increased its stake in MEG Energy Corp. to 9.8 percent. This move follows the company’s friendly takeover offer for MEG, as Cenovus acquired approximately 3.28 million additional shares, bringing its total holdings to 25 million shares. The announcement comes shortly after Strathcona Resources Ltd. opted to withdraw its competing takeover proposal for MEG.

The Cenovus offer values MEG at about $8.6 billion, which includes the assumption of debt. The takeover bid consists of a combination of cash and stock, split evenly between the two. Shareholders of MEG are scheduled to vote on this proposal on October 22, 2025.

Strategic Implications for Cenovus and MEG

Cenovus and MEG own adjacent oilsands properties located at Christina Lake, south of Fort McMurray, Alberta. This geographic proximity may enhance operational synergies if the takeover is successful. Analysts suggest that integrating MEG’s assets could significantly bolster Cenovus’s production capabilities and overall market position.

The strategic rationale behind Cenovus’s increased stake aligns with the company’s broader objectives to expand its presence in the Canadian oilsands sector. By investing in MEG, Cenovus aims to tap into additional resources and enhance its competitive edge against other players in the industry.

Market Reactions and Future Outlook

The withdrawal of Strathcona’s offer has created a clearer path for Cenovus, allowing it to strengthen its position without immediate threats from competing bids. Market analysts are closely monitoring the situation, particularly the upcoming shareholder vote, as it carries significant implications for both companies’ futures.

Cenovus’s move reflects an aggressive strategy in a sector where consolidation is becoming increasingly common. As energy markets evolve, the potential for further mergers and acquisitions within the oilsands industry remains a topic of considerable interest.

This report was first published by The Canadian Press on October 15, 2025.