Total drops bid for UTS Energy

Total E&P Canada has abandoned its $830 million (Can.) hostile bid for oil sands firm UTS Energy after failing to secure enough shareholders to approve the deal.

April 30, 2009

Uchenna Izundu
OGJ International Editor

LONDON, Apr. 30 -- Total E&P Canada Ltd. has abandoned its $830 million (Can.) hostile bid for oil sands firm UTS Energy Corp. after failing to secure enough shareholders to approve the deal.

Total was unable to meet the two thirds threshold of shareholder approval needed to complete the transaction.

Total had increased its offer to $1.75 (Can.)/share cash to acquire all outstanding common shares of UTS from $1.30 (Can.)/share (OGJ Online, Apr. 17, 2009).

"While we believed that our offer represented certainty and fair value for UTS shareholders, we acknowledge their decision," said Michael Borrell, president and chief executive officer of Total E&P Canada. "Total Canada remains committed to its current activities and investments in Canada and will continue to implement its willing strategy in the oil sands."

UTS said the increased offer undervalued the company, adding that it wanted to increase its shares in other ways. It was seeking at least $3.57 (Can.)/share. UTS is involved in the Fort Hills oil sands project in Alberta, operated by Petro-Canada.

Contact Uchenna Izundu at [email protected].