CNOOC completes US$15b Nexen buy

THE contentious US$15.1 billion takeover of Canadian oil and gas company Nexen Inc by Chinese state-owned entity CNOOC Ltd closed on Monday, more than seven months after China's largest-ever foreign takeover was announced.

Nexen, based in Calgary, Alberta, said in a statement on Monday that the deal had closed and its shareholders would receive US$27.50 (RM85.25) in cash for each Nexen share.

Nexen said its common and preferred shares would be delisted from the Toronto Stock Exchange in a few days, while its common shares were expected to cease trading on the New York Stock Exchange prior to the market opening yesterday.

The company said Kevin Reinhart would remain chief executive of Nexen, which will operate as a wholly-owned subsidiary of CNOOC.

Nexen also said it would have a new board chaired by Li Fanrong, who is CEO of CNOOC. Other members of the new Nexen board will be Reinhart, Fang Zhi, Barry Jackson, Thomas O'Neill and William Berry.

The takeover, originally announced in July, won approval from Canadian regulators in December. Earlier this month, CNOOC overcame its last major hurdle after the deal was cleared by the Committee on Foreign Investment in the United States, which had a say because of Nexen's exploration and production assets in the Gulf of Mexico.

The two companies have not disclosed what conditions were imposed by Canadian and US regulators for the deal to win approval, but one of CNOOC's advisers said the parameters around the assurances were largely in line with expectations.

The Nexen acquisition gives CNOOC new offshore production in the North Sea, the Gulf of Mexico and off western Africa, as well as producing properties in the Middle East and Canada.

In Canada, CNOOC gains control of Nexen's Long Lake oil sands project in the oil-rich province of Alberta, as well as billions of barrels of reserves in the world's third-largest crude storehouse - the oil sands in the province of Alberta. Reuters