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Mergers, Acquisitions & Divestitures

Mergers, Acquisitions & Divestitures
Mergers, Acquisitions & Divestitures

The global financial markets’ gradual recovery since 2008 continues to dovetail with unprecedented levels of interest in Canada's resource sector. The result has been an explosion of activity in the Canadian M&A practice, particularly in the energy industry, marked by the return of financial buyers and strategic investors pursuing acquisitions in order to increase earnings and gain both operational and technological expertise.

There is every reason to think this trend will accelerate and expand. Mega-deal activity is set to continue in the Canadian energy sector, characterized by creative deal structures such as partnerships, joint ventures, minority investments and long-term supply arrangements.

Price and valuation volatility, along with debt and liquidity issues, will significantly affect M&A, consolidation and divestitures activity. Despite signs of financial recovery, the gap between buyers’ and sellers’ expectations will likely lead to more unsolicited and hostile bids. Legal loopholes and market underperformance will drive greater shareholder activism. Foreign energy companies continue to enter Canada and will change the nature and practices of our domestic industry.

In this rapidly fluctuating environment, Blakes is proud to boast an extraordinary depth of talent and resources in the energy/finance field. More than 100 M&A lawyers and more than 100 energy law practitioners throughout our Canadian and overseas offices constitute an exceptional cross-border capability for our clients every day. We believe that no other firm can combine our expertise in M&A, competition, securities, tax and environmental law with our thorough understanding of the oil and gas industry’s business and legal environment.

Recent Experience
  • Algonquin Power and Utilities on its acquisition of the New Brunswick natural-gas distribution business from Enbridge for C$331-million.

  • Cona Resources Ltd., a portfolio company of Waterous Energy Fund, on its C$740-million acquisition of Pengrowth Energy Corporation.

  • Kinder Morgan in connection with the C$4.35-billion acquisition of Kinder Morgan Canada Limited and the Cochin pipeline system by Pembina Pipeline Corporation.

  • Kinder Morgan Canada on its C$4.5-billion sale of the Trans Mountain pipeline system and expansion project to the Government of Canada.

  • Strath Resources Ltd. on the acquisition of Montney assets from Paramount Resources Ltd. for a total consideration of C$340-million — paid 50 per cent in cash and 50 per cent in common shares of Strath.

  • Pembina Pipeline Corporation on its C$9.4-billion acquisition of Veresen Inc.

  • Cenovus Energy Inc. on the sale of its Palliser crude oil and natural-gas assets in southeastern Alberta to Torxen Energy and Schlumberger for C$1.3-billion.

  • Cenovus Energy Inc. on the sale of its Suffield crude oil and natural-gas assets in southern Alberta to International Petroleum Corporation for C$512-million.

  • Suncor Energy Inc. on the sale of its Petro-Canada lubricants division to HollyFrontier Corporation for C$1.13-billion.

  • Husky Energy on its C$1.7-billion sale of 65 per cent of certain midstream assets to Cheung Kong Infrastructure Holdings Limited and Power Assets Holding Limited (three other law firms also advised Husky).

  • Cenovus Energy Inc. on the sale of its wholly owned subsidiary Heritage Royalty Limited Partnership to Ontario Teachers’ Pension Plan for C$3.3-billion.

  • Daylight Energy Ltd. on its C$2.2-billion acquisition by Sinopec.

  • Suncor Energy Inc. on its purchase and sale of interests in the Fort Hills and Joslyn mining projects and the Voyageur (U3) upgrader with Total E&P Canada Ltd., and on related development and operating agreements. Further assisted Suncor with its strategic merger with Petro-Canada.

  • Sinopec Group on its C$4.65-billion purchase of ConocoPhillips Company’s interest in the Syncrude joint venture, the largest oil sands venture in the world that includes surface mining, extraction and upgrading and has been in production for over 30 years.

  • UTS Energy Corporation on its C$1.5-billion plan of arrangement with Total E&P Canada Ltd., whereby Total acquired UTS Energy.

  • TriStar Oil & Gas Ltd. on its C$2.8-billion acquisition by Petrobank Energy and Resources Ltd., thereby creating a new publicly listed company named PetroBakken Energy Ltd.

  • Nexen Inc. on its C$735-million acquisition of an additional 15 per cent interest in the Long Lake oil sands joint venture project and the joint venture lands from OPTI Canada Ltd.

  • Cliffs Natural Resources Inc. on its C$240-million acquisition of Freewest Resources Canada Inc., which was supported by Freewest as superior to an unsolicited take-over bid by Noront Resources Ltd.

  • Pure Energy Services Ltd. on its strategic merger with Canadian Sub-Surface Energy Services Corporation.