Suncor to buy Petro-Canada for $18.4B

Canadian oil companies combine to create largest oil company in the country.

CALGARY, Alberta (Reuters) — Suncor Energy Inc, Canada’ No. 2 oil company, agreed to buy rival Petro-Canada for about $18.43 billion Canadian ($14.86 billion U.S.) to expand its oil sand reserves and create the country’s biggest energy group.

The deal comes after a period of missed earnings targets and project delay at Petro-Canada, and is expected to be completed in the third quarter of 2009.


The all-share offer represents a premium of about 28% to the $29.65 Canadian closing price of Petro-Canada shares on Friday as assuming 484.4 million Petro-Canada shares outstanding as of Dec. 31, 2008.

On completion of the proposed deal, Suncor’s existing shareholders will own about 60% and Petro-Canada shareholders will own about 40% of the merged company, the companies said.

Reuters