Cenovus Energy $23.6 billion strategic combination with Husky Energy

Industry: Utilities & energy

On Jan. 1, Cenovus Energy Inc. ("Cenovus") completed its $23.6 billion strategic combination with Husky Energy Inc. ("Husky") to create a resilient integrated energy leader. The all-stock transaction was accomplished through a court sanctioned plan of arrangement under the Business Corporations Act (Alberta) and approved by both companies’ shareholders and multiple regulatory authorities.

The arrangement involved the exchange of multiple classes of securities. Each Husky common shareholder received 0.7845 of a Cenovus common share and 0.0651 of a Cenovus common share purchase warrant in exchange for each Husky common share. In addition, Husky preferred shareholders exchanged each Husky preferred share for one Cenovus preferred share with substantially identical terms. The Cenovus common share purchase warrants were listed on the TSX and NYSE, and each series of the Cenovus preferred shares was listed on the TSX.

Upon closing of the transaction, Husky became a wholly owned subsidiary of Cenovus and amalgamated with Cenovus on Mar. 31, 2021. As a result of the transaction, Cenovus has become Canada’s third largest crude oil and natural gas producer and the second-largest Canadian-based refiner and upgrader.

The transaction included a number of complex elements including transactional strategy, securities and regulatory compliance, the negotiation of shareholder standstill and support agreements, the plan of arrangement, and court, shareholder, stock exchange and regulatory approvals. The successful completion of the arrangement and the effective integration of Cenovus and Husky required experience in complex and intersecting legal fields delivered by lawyers focusing on capital markets and M&A, financial services, competition, employment, tax, regulatory and energy law.

The in-house legal team that represented Cenovus consisted of
Al Reid (executive VP, stakeholder engagement, safety and legal and general counsel),
Gary Molnar (vice-president, legal, assistant general counsel and corporate secretary),
Natasha Dhillon-Penner,
Jason Francoeur,
Geoffrey Paskuski,
Suzanne Smith,
Alex Himour,
Colin Ritchie.

Bennett Jones LLP acted as lead external counsel to Cenovus, with a team led by
John Piasta (M&A),
and which included
Harinder Basra,
Colin Perry,
Brent Kraus (M&A),
Beth Riley (competition and M&A),
Anu Nijhawan (tax),
Thomas McInerney,
Ashley White (energy),
Mark Rasile (banking),
Carl Cunningham (employment),
Mike Theroux (litigation),
Shawn Munro (regulatory),
Mark Powell,
Jordan Fremont,
Sebastien Gittens,
Keely Cameron,
Eric Chernin,
Jared Mackey,
Jessica Horwitz,
Dom Sorbara,
Kevin Zhou,
Steven Bodi,
Duncan D'Arcy,
Kathryn Shaw,
Allegra Hessels,
Annie Tonken,
Graham Cook,
Julia Pasieka.

Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as Cenovus's U.S. counsel, with a team that included
Andrew Foley,
Adam Givertz (corporate partners);
Steve Centa (counsel);
Lewis Fainer,
Ian Hazlett,
Sarah Lu,
David Marshall,
Joshua Thompson,
Thea Winterton-Perks,
Sam Zhu (associates);
Robert Holo (tax partner);
Dhrumit Joshi;
Valentine Lysikatos Carey (associates);
Jean McLoughlin (employee benefits partner)
Lisa Krausz Eisenberg (counsel);
William Chen (associate);
Rachel Fiorill,
Peter Jaffe (litigation counsel);
Richard Elliott (international trade counsel);
Marta Kelly (antitrust counsel);
Chad de Souza (associate).

The in-house team that represented Husky consisted of
James Girgulis,
Jason McCormick,
Dave Bramwell,
Cheryl Ann Merchant,
Melanie Pituch,
Kyla Stott-Jess.

Osler, Hoskin & Harcourt LLP advised Husky Energy Inc. with a team consisting of
Dan Kolibar,
Justin Sherman,
Donald Gilchrist,
Kelsey Armstrong,
Peter Osmond,
Jacob Young,
Aqeel Virk,
Lindsay Hofer,
Storme Mckop (corporate),
Riley Whitlock,
Allan Morgan (real estate),
Shuli Rodal,
Kaeleigh Kuzma,
Gajan Sathananthan (competition/antitrust and foreign investment),
Tristram Mallett,
Lauren Harper,
Kelly Twa (litigation).

Norton Rose Fulbright US LLP acted as U.S. counsel to Husky, with a team led by
Chris Hilbert,
and which included
James Lacey (corporate and securities),
Stefan Reisinger (regulatory),
Marc Waha (regulatory),
Andrew Eklund (antitrust),
Gerald Stein (antitrust).

McCarthy Tétrault LLP acted as tax counsel to Husky, with a team that included
Raj Juneja,
Robert Kopstein,
Justin Shoemaker.

Stikeman Elliott LLP acted as counsel to Hutchison Whampoa Europe Investments S.à r.l., a major shareholder of Husky, with a team that included
Elizabeth Breen,
John Ciardullo,
J.R. Laffin,
J.B. Elliott,
Malcolm Peck-McQueen (M&A),
David Weekes,
Lindsay Gwyer,
Sarah Visentin (tax),
Michael Kilby (regulatory).

Marvin Yontef, Esq. acted as legal counsel to L.F. Investments S.à r.l., a major shareholder of Husky.

Skadden Arps Slate Meagher & Flom LLP acted as U.S. competition counsel to Hutchison Whampoa Europe Investments S.à r.l. and L.F. Investments S.à r.l., with a team led by
June Dipchand (M&A partner),
and which included
Eric Cochran (partner),
Marissa Smith,
Michael Amalfe (M&A associates);
Ryan Dzierniejko (partner),
John Zelenbaba (capital markets associate);
Michael Leiter (national security partner);
Kenneth Schwartz (antitrust partner);
Liz Malone (environmental counsel).

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