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Canada gives nod to CNOOC-Nexen deal

Dec. 10, 2012 at 7:10 AM   |   Comments

CALGARY, Alberta, Dec. 10 (UPI) -- Canadian energy company Nexen announced that it secured government approval for a proposed takeover bid by China National Offshore Oil Corp.

CNOOC in July offered to take over Nexen for $15 billion. Around 90 percent of the Nexen shareholders voted in favor of the deal. Nexen announced that Canadian Industry Minister Christian Paradis approved of the takeover proposal, ending the Canadian approval process.

"This is an important milestone in the process and confirms our belief that this transaction provides a number of significant benefits to Canada and to Nexen," Nexen Interim President Kevin Reinhart said in a statement.

CNOOC said Calgary would serve as its headquarters for North and Central American operations. The Chinese company said it would seek to retain Nexen's employees.

Both companies last month reissued their voluntary request to the U.S. Committee on Foreign Investment to examine CNOOC's proposed $15 billion takeover.

The U.S. government needs to review the deal because Nexen has operations in the U.S. waters of the Gulf of Mexico.

The Canadian government has sought to add diversity to an oil sector dependent on the U.S. market. U.S. officials have expressed concern about the CNOOC deal, saying it could equate to a major U.S. wealth transfer.

© 2012 United Press International, Inc. All Rights Reserved. Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
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