Canadian Occidental Petroleum Ltd.: The Wascana Energy Inc. Decision
(10 pages of text)
Wascana Energy Inc., an oil and gas producer, had just rejected an unsolicited $1.8 billion takeover offer from Talisman Energy Inc. Rival Canadian Occidental Petroleum Ltd. had gained access to confidential Wascana data in order to determine whether a higher bid than Talisman's was warranted, and if so, how to structure the deal. The acquisition would need to make strategic sense.
This case can be used in an introductory finance course to teach students about valuation in a strategic setting. Students should be familiar with cost of capital and time value of money concepts prior to studying this case. Specifically, this case is designed to provide an opportunity for students to learn about: the oil and gas industry; valuation of oil and gas companies; mergers and acquisitions and playing the game, including pre-acquisition agreements and shareholder rights plans; the strategy involved in merger and acquisition situations.
Mining, Quarrying, and Oil and Gas Extraction
Canada, Medium, 1997
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