Suncor completes $2.8B equity financing, acquisition of additional Syncrude interest and debt tender offer

On June 22, 2016, Suncor Energy Inc. (“Suncor”) completed a cross-border bought deal offering of 82,225,000 common shares for gross proceeds of approximately $2.9 billion, which included the full exercise of the over-allotment option by the underwriting syndicate led by TD Securities Inc., CIBC Capital Markets and J.P. Morgan Securities Canada Inc. A portion of the proceeds was used to finance the acquisition of an additional 5-per-cent interest in the Syncrude oil sands joint venture from Murphy Oil Corp.’s Canadian subsidiary for approximately $937 million, which was completed on June 23, 2016, with the remainder used to reduce indebtedness and provide ongoing balance sheet flexibility. As a result of the transaction, Suncor, which is Canada’s largest integrated oil company, increased its ownership stake in Syncrude from 48.74 per cent to 53.74 per cent.

Additionally, on June 23, 2016, Suncor announced that it had completed a tender offer to purchase a total principal amount of approximately US$687.7 million of senior notes issued by its subsidiary, Suncor Energy Ventures Holding Corp. (previously, Canadian Oil Sands Ltd.), for a total purchase price of around US$742.1 million.

Suncor’s in-house legal team on the various transactions included Janice Odegaard, QC, Jacqueline Moore, Shawn Poirier, Jessica Green, Mike Munoz, Dana Hnatiuk, Chris Salamon and Peter Duthie. Suncor’s external Canadian counsel on the transactions was Blake, Cassels & Graydon LLP with a team that included Chad Schneider, Jeff Bakker, Jennifer Marshall, Nav Dhaliwal and Nicole Cargill (securities and M&A), Peter Keohane, Keith Byblow and Ky Kvisle (energy and M&A), Carrie Aiken (tax), and Jason Gudofsky and Litsa Kriaris (competition).

Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as Suncor’s external US counsel on the equity offering and note repurchases with a team of Adam Givertz, Steve Centa, Christina Kurtz, Kristiina Leskinen, Ronnie Ollo and Rebecca Vasluianu (corporate), and David Mayo and Haiyun Zhao (tax).

Burnet, Duckworth & Palmer LLP acted as underwriters’ counsel for the equity offering with a team that included Alyson Goldman, Jessica Brown and Shanlee von Vegesack (securities) and Kirk Lamb (tax), and acted as counsel to Murphy in the Syncrude acquisition with a team led by Alicia Quesnel and Carolyn Wright.

Davis Polk & Wardwell LLP acted as the underwriters’ US counsel for the equity offering and as the dealer managers’ US counsel in the note repurchase with a team consisting of Byron Rooney, Julia Danforth and Paul Connell.