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The Cenovus offer would see MEG shareholders choose between $27.25 in cash or 1.325 Cenovus common shares for each MEG share, subject to certain limits.

Strathcona is calling the Cenovus deal "lopsided" and the MEG board's sale process "broken" for accepting that offer. 

"Congratulations, MEG board — you are in first place in the last 20 years for leaving the most amount of money on the table for your shareholders. You win the prize," Strathcona executive chairman Adam Waterous said in an interview Monday.

Waterous noted Cenovus' stock jumped 10 per cent in the days following news of its deal with MEG, but typically an acquirer's share price would fall after such an announcement.

Waterous says that equates to a $3.9-billion gain in Cenovus' stock market value that MEG shareholders are mostly not able to enjoy, as they would only own four per cent of a post-takeover company. 

Under the Strathcona deal, MEG shareholders would own 43 per cent of the new entity. 

"These are two radically different paths. One is a cash exit, leaving Cenovus a $3.9-billion gain," Waterous said. 

"And the second is you're not getting off the train, you stay on the train and you try to capture that over time."

The new offer expires on Oct. 20.

MEG and Cenovus did not respond to a request for comment on Monday. 

MEG's board has raised concerns about Strathcona's majority shareholder — Waterous Energy Fund, which Waterous runs — selling its stake after the takeover.

Waterous said he'd be in it for the long haul and there is no intention of exiting after a potential deal closes. He said Monday that his fund would be willing to enter into a lockup agreement not to sell the shares if MEG were to support its bid. 

The Cenovus deal must be approved by a two-thirds majority vote by MEG shareholders expected to be held on Oct. 9. Strathcona says it intends to vote its 14.2 per cent interest in MEG against the deal.

"I have not spoken to a single MEG shareholder who is happy with the MEG board deal with Cenovus," Waterous said. 

"This is going to be taught in business schools about boards of directors' dereliction of fiduciary duty." 

Cenovus and MEG have side-by-side oilsands properties at Christina Lake, south of Fort McMurray, Alta. Strathcona also has operations in the region, and Waterous said a combination with his firm would offer similar benefits. 

Desjardins Securities analyst Chris MacCulloch said he's skeptical Strathcona will be able to make it past the finish line with its updated offer. 

"Specifically, the shift to an all-stock transaction by Strathcona could be viewed as making the amended offer less attractive versus Cenovus as it would still lock MEG shareholders in as minority shareholders of a less liquid company while saddling them with the lower-quality assets of the combined entity," he wrote.

"Based on our numerous discussions with MEG shareholders, we have detected a strong reluctance to hold Strathcona paper for these reasons, although the material sweetening of the Strathcona offer may change the fiduciary calculus."

MacCulloch said the sweetened Strathcona bid may put pressure on Cenovus to increase its own offer, likely with a higher equity component so that shareholders can benefit from a combination in future. Cenovus has the financial flexibility to do so, he noted. 

MEG shares rose 2.3 per cent, or 67 cents, to $29.02 at the close of trading Monday on the TSX.

Cenovus stock was up one cent at $22.12, while Strathcona fell 11 cents $38.31 after earlier dropping as low as $37.58. 

This report by °µÍø½ûÇø was first published Sept. 8, 2025.

Companies in this story: (TSX:MEG, TSX:SCR, TSX:CVE)