Ottawa extends review of Petronas deal to acquire Progress Energy Resources
Progress says government, Petronas have agreed to extend review to Oct. 19
Risk & Compliance
Investment Canada Act
mergers and acquisitions
CALGARY—Ottawa is extending a review of the proposed takeover of Progress Energy Resources Corp. by Malaysia’s Petronas.
The Canadian company says the government and Petronas have agreed to extend the review under the Investment Canada Act to Oct. 19.
The deal faces the key “net benefit” test under the act.
Petronas has agreed to pay $6-billion for Calgary-based Progress—its partner in B.C. shale natural gas development.
The deal is expected to close about three days after the government approves the transaction.
The Investment Canada review comes as Ottawa is also examining a Chinese company’s $15.1-billion offer for Calgary-based Nexen Inc.
Prime Minister Stephen Harper has said the Nexen deal “raises a range of difficult policy questions, difficult and forward-looking issues.”
Harper made his remarks shortly after the NDP formally declared its opposition to the Nexen takeover, even though as the official Opposition it doesn’t have the power to block the transaction.
“We’ve certainly seen the opinion polls moving over the last month . . . showing more and more opposition by Canadians to this takeover,” said Peter Julian, the NDP natural resources critic.
The current review period for China National Offshore Oil Co.’s proposal to buy Nexen ends Oct. 12 but can be extended by up to a month.
In 2010, the Conservative government blocked a hostile takeover offer for Potash Corp. of Saskatchewan by BHP Billiton after opposition from Saskatchewan Premier Brad Wall.
The potash deal was the second foreign takeover blocked by Conservatives.
U.S. defence contractor Alliant Techsystems Inc. was prevented in 2008 from buying the space technology business of MacDonald, Dettwiler and Associates Ltd.