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Privately held Cygnet Energy Ltd. has announced an all-cash acquisition of Kiwetinohk Energy Corp. in a deal valued at about CAD 1.4 billion (around USD 998.29 million), including debt. The offer values Kiwetinohk at CAD 24.75 per share, reflecting a 10.4 percent premium to its last closing price. The merger will combine their operations in Alberta's Montney and Duvernay regions, creating a stronger producer with over 44,000 barrels of oil equivalent per day. The transaction is being funded by NGP Energy Capital Management and The Carlyle Group and is expected to close in late December.
Cygnet Energy Ltd., a privately held Canadian oil and gas company, has entered into an agreement to acquire Kiwetinohk Energy Corp. in an all-cash transaction valued at approximately CAD 1.4 billion (about USD 998.29 million), inclusive of debt. Under the terms of the agreement, Cygnet will pay CAD 24.75 per share in cash to Kiwetinohk shareholders, representing a premium of around 10.4 percent over the company's previous closing price, based on Reuters calculations. Advertisement
The acquisition brings together two companies with complementary positions in Alberta's Montney and Duvernay shale plays-two of Canada's most productive oil and gas regions. Once completed, the combined company will produce more than 44,000 barrels of oil equivalent per day, weighted heavily toward liquids. Cygnet said the transaction will enhance its operational scale and establish it as one of the leading operators across these key shale basins.
The deal will be financed through investment funds managed by NGP Energy Capital Management, an existing shareholder in Cygnet, and by The Carlyle Group, which is joining as a new investment partner. In addition to cash financing, certain Kiwetinohk shareholders, including ARC Financial Corp., are expected to roll over a portion of their holdings into Cygnet equity.
The agreement is structured as a statutory plan of arrangement under Canadian law. It remains subject to approval by Kiwetinohk shareholders, court sanction, and regulatory clearances, including those required under the Competition Act (Canada). Both companies have stated that they expect the deal to close toward the end of December, provided all necessary approvals are secured.
Kiwetinohk, based in Calgary, has built a strong asset base in Alberta's Simonette and Placid regions and holds an extensive drilling inventory. According to its recent corporate filings, the company has 429 net drilling locations across the Montney and Duvernay formations and a proven-plus-probable reserve life index of roughly 24 years. The company has also been developing a renewable power business alongside its core upstream operations.
For Cygnet, the acquisition marks a strategic expansion that builds on its existing presence in Western Canada. The company has previously acquired smaller assets in the Montney and Duvernay areas and has been looking to consolidate its position in the basin. By combining operations with Kiwetinohk, Cygnet expects to achieve better infrastructure utilization, cost efficiency, and operational flexibility.
Industry analysts noted that this deal continues the trend of consolidation in Canada's energy sector. Earlier this year, Cenovus Energy Inc. and Strathcona Resources Ltd. were involved in a competitive bid for MEG Energy Corp., driven by the strategic importance of Alberta's oil-rich assets such as the Christina Lake project.
The Montney and Duvernay formations have been central to Canada's recent production growth, attracting increasing investment due to their rich hydrocarbon resources and established infrastructure. This acquisition reflects growing confidence in the long-term prospects of these regions as key drivers of Canadian oil and gas output.
Source Reuters
5th Jun, 2025
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