Nexen's preferred, common shareholders approve acquisition by Cnooc

By Toni Weeks

San Diego, Sept. 20 - Nexen Inc. announced that holders of the company's common shares and series 2 class A cumulative redeemable rate reset preferred shares approved the company's plan of arrangement entered into on July 23 in connection with the acquisition of Nexen by Cnooc Ltd.

The plan of arrangement was approved by about 99% of the votes cast by the common shareholders and about 87% of the votes cast by the preferreds shareholders at a meeting on Sept. 20, according to a press release.

As previously reported, Cnooc Ltd. announced it would use existing cash resources and external financing to acquire all of the outstanding common shares of Nexen Inc. for $27.50 per share in cash, or about $15.1 billion, with Nexen's current debt of about $4.3 billion to remain outstanding. The purchase price represents a premium of 61% to the closing price of Nexen's common shares on July 20.

Cnooc said it would pay C$26.00 per share in cash plus any accrued dividends to holders of Nexen preferred shares in a separate class vote. Closing of the transaction is not conditioned on approval by the holders of the Nexen preferred shares, according to a previous Cnooc news release.

The boards of directors of both companies previously approved the transaction.

Cnooc will pay a $425 million termination fee to Nexen should the transaction not close due to regulatory reasons in China.

By acquiring Nexen, Cnooc will establish Calgary, Alta., as its North and Central American headquarters and manage Nexen's global operations.

The transaction is subject to the granting of the final order by the Court of the Queen's Bench of Alberta, the receipt of required regulatory approvals and the satisfaction or waiver of other customary closing conditions, and it is expected to close in the fourth quarter of 2012.

Cnooc is a Hong Kong-based oil and gas exploration and production company.

Nexen is an energy company based in Calgary, Alta.

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