Crescent Point Energy Corp., a Canadian producer of light oil, agreed to a buy closely held CanEra Energy Corp. for about C$766 million ($694 million) in cash and stock to increase its holdings in southeast Saskatchewan.
The offer includes 12.9 million Crescent Point shares and C$192 million in cash, Calgary-based Crescent Point said today in a statement. Based on yesterday’s closing price, the deal is worth about C$1.1 billion including the assumption of C$348 million in debt.
The purchase gives Crescent Point access to the equivalent of about 10,000 barrels of oil a day and Calgary-based CanEra’s land holdings in the Torquay formation of southeast Saskatchewan. With 10 Canadian oil and natural gas purchases in the past four years, Crescent Point is the most active acquirer after Whitecap Resources Inc., according to data compiled by Bloomberg.
“The assets consolidate and complement our conventional assets and will generate significant free cash flow, and the 260 net sections of Torquay land we gain provide further exposure and upside potential in a play that we’re very excited about,” Scott Saxberg, chief executive officer of Crescent Point, said in the statement.
The deal requires regulatory, court and other approvals and is expected to close on or about May 15, Crescent Point said. Assuming it closes, Crescent Point boosted its 2014 production forecast 5 percent to average the equivalent of 133,000 barrels of oil a day and increased its capital spending for the year by 1.4 percent.
Bank of Montreal acted as adviser to Crescent Point and Toronto-Dominion Bank advised CanEra.