Cenovus Energy Inc. (TSX:CVE)(NYSE:CVE) ("Cenovus") announced today that it has entered into a bought-deal financing agreement to sell 187.5 million common shares ("Common Shares") at a price of $16.00 per share (the "Offering").
The Offering will be made through a syndicate of underwriters (the "Underwriters") led by RBC Capital Markets and J.P. Morgan. The gross proceeds from the Offering will be approximately $3.0 billion. The Offering is subject to customary closing conditions, including the receipt of applicable stock exchange approvals, and is expected to close on or about April 6, 2017.
Cenovus has granted the Underwriters an over-allotment option to purchase up to an additional 28.125 million Common Shares at the offering price, exercisable for a period of 30 days after closing. If the over-allotment option is exercised in full, the gross proceeds from the Offering will be approximately $3.45 billion.
Cenovus intends to use the net proceeds from the Offering to finance a portion of the cash consideration payable by it for the purchase of assets in Western Canada from ConocoPhillips, the details of which were announced today in a separate news release issued by Cenovus (the "Acquisition"). The assets to be acquired include ConocoPhillips' 50% interest in the FCCL Partnership, the companies' jointly owned oil sands venture operated by Cenovus, as well as the majority of ConocoPhillips' Deep Basin assets in Alberta and British Columbia. The closing of the Offering is not conditional upon the Acquisition being completed. In the event that the Acquisition is not completed, Cenovus may use the net proceeds of this Offering to, among other things, reduce its outstanding indebtedness, finance future growth opportunities including acquisitions and investments, finance its capital expenditures, repurchase outstanding Common Shares or for other general corporate purposes.
The Common Shares will be offered in all of the provinces and territories of Canada by way of a prospectus supplement to Cenovus's short form base shelf prospectus, dated February 24, 2016 (collectively, the "Prospectus"). The prospectus supplement will also be filed with the U.S. Securities and Exchange Commission (the "SEC") as part of a registration statement on Form F-10 in accordance with the multi-jurisdictional disclosure system established between Canada and the United States.
Cenovus Energy Inc.
Cenovus Energy Inc. is a Canadian integrated oil company. It is committed to applying fresh, progressive thinking to safely and responsibly unlock energy resources the world needs. Operations include oil sands projects in northern Alberta, which use specialized methods to drill and pump the oil to the surface, and established natural gas and oil production in Alberta and Saskatchewan. The company also has 50% ownership in two U.S. refineries. Cenovus shares trade under the symbol CVE, and are listed on the Toronto and New York stock exchanges.
SOURCE: Cenovus Energy Inc.
The Toronto Stock Exchange has neither approved nor disapproved the information contained herein.