Feb 12 (Reuters) – Canadian oil producer Cenovus Energy Inc said it may sell up to $5 billion of stock, debt or other securities, a day after it announced a dividend cut, as the company shores up its balance sheet amid a slump in oil prices.
The company filed with the U.S. Securities and Exchange Commission for a mixed shelf offering after the company also said on Thursday it would cut its 2016 budget and lay off more employees. (http://1.usa.gov/1WhvZXF)
In a mixed shelf offering a company may sell securities in one or more separate offerings without filing a prospectus for each one. The filing does not necessarily mean that the securities will be sold immediately, if at all.
U.S. oil producers including Oasis Petroleum Inc and Pioneer Natural Resources Co have also launched stock offerings, indicating that some oil producers can tap the capital markets even as highly indebted ones struggle to survive.
Cenovus cut its dividend by 69 percent on Thursday and said it would further reduce its workforce, on top of last year's 24 percent reduction.
These measures come months after the company sold its oil and gas royalty properties to Ontario Teachers' Pension Plan for about C$3.3 billion, to strengthen its balance sheet.
Cenovus had total debt of C$6.53 billion ($4.70 billion) as of Dec. 31. The company has a market value of C$11.62 billion.
($1 = 1.3901 Canadian dollars)
(Reporting by Anet Josline Pinto in Bengaluru; Editing by Shounak Dasgupta)
Copyright 2017 Thomson Reuters. Click for Restrictions.
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Most Popular Articles
From the Career Center
Jobs that may interest you