(File Photo: An aerial view of Syncrude’s Mildred Lake mine)
Canadian Oil Sands Ltd., is playing defence after Suncor’s buyout attempt on Monday. COS issued a new shareholder rights plan, otherwise known as a poison pill defence following Suncor’s $4.3 billion stock offer.
The plan allows shareholders to buy stock in COS at a discount, in an effort to make the shares less attractive to Suncor.
“The Board will consider Suncor’s unsolicited offer in both the current context and in light of the strong long-term potential of Canadian Oil Sands,” said Donald Lowry, Chairman of the Board. “Shareholders do not need to take any action or make any decision about the Suncor offer until the board has had an opportunity to fully review the offer and to provide a recommendation based on careful analysis.”
According to the Canadian Press Suncor approached COS twice in March and April in an attempt at making a friendly takeover, but COS’ board rejected both offers unanimously.
Suncor’s offer on Mar. 31, 2015 was reportedly valued at $11.84 a share, it’s current deal values shares at $8.84 apiece. At the time of Suncor’s bid at 5 a.m. Monday morning COS stock was trading at $6.19 per share, it has since ballooned to $9.44 per share this morning.
If COS approves the buyout Suncor will own a 49 per cent stake in Syncrude.
– With files from the Canadian Press
