Deadline Extended for CNOOC Takeover of Nexen

Deadline Extended for CNOOC Takeover of Nexen

Canada's Nexen and China National Offshore Oil Corporation (CNOOC) have mutually agreed to extend the closing date of CNOOC’s $15.1 billion takeover of the Canadian oil and gas producer by 30 days to March 2, 2013, CNOOC confirmed Monday in a disclosure.

Nexen revealed the same in a statement released Sunday, adding that it would also postpone the release of its 2012 fourth quarter financial results. Nexen did not specify a date for the release of its results.

"Completion of the Agreement remains subject to the receipt of the United States regulatory approval and the satisfaction and waiver of other customary closing conditions. Key regulatory approvals have been received from Canada, the United Kingdom, the European Union and the People’s Republic of China," Nexen said in its issued statement.

In December last year, Canada approved CNOOC's proposed acquisition of Nexen, clearing a major hurdle for the Beijing-based energy giant in completing what would be China's biggest ever foreign acquisition. It is also the most ambitious bid by a foreign government-owned entity so far to enter North America's booming energy industry.

CNOOC and Nexen were already partners in developing Canada's oil sands. The Chinese company acquired Nexen's bankrupt partner, OPTI Canada Inc., which was involved in the Long Lake oil sands project, in 2011. CNOOC launched its all-cash bid for Nexen on July 23, offering $27.50 a share, or a premium of over 60 percent versus the share price on the last trading day before the two companies announced their proposed transaction.

As part of the acquisition, CNOOC will make Calgary the head office of its North and Central American operations. This office will oversee the operation and growth of Nexen's assets in North and South America, Europe and West Africa and CNOOC 's portfolio in Canada, the United States and Central America.

CNOOC plans to retain Nexen's current management team and employees, and intends to list its common shares on the Toronto Stock Exchange.

For CNOOC, the Nexen deal comes seven years after the Chinese company's 2005 failure to acquire Unocal Corp. for $18.5 billion.


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