SU » Topics » Reasons for the Arrangement

This excerpt taken from the SU 6-K filed May 1, 2009.

Reasons for the Arrangement

        Following receipt of the advice and assistance of the financial advisors and legal counsel, the Petro-Canada Board carefully evaluated the terms of the proposed Arrangement, and ten of the twelve directors (with two directors voting against) at a meeting of Petro-Canada Board held on March 22, 2009: (a) determined that the Arrangement is fair to Petro-Canada Shareholders; (b) determined that the Arrangement and the entering into of the Arrangement Agreement are in the best interests of Petro-Canada; (c) approved the entering into of the Arrangement Agreement; and (d) resolved to recommend that Petro-Canada Shareholders vote in favour of the Arrangement. In reaching these determinations and approvals the Petro-Canada Board considered, among


other things (including those matters described under "— Anticipated Benefits of the Arrangement"), the following factors and potential benefits and risks of the Arrangement:

    the Arrangement is the preferred transaction available to Petro-Canada and the Petro-Canada Shareholders following an extensive and thorough review of alternative strategic courses of action conducted by Petro-Canada, which included advice from RBC Dominion Securities, Deutsche Bank and Macleod Dixon and extensive contacts and discussions with third parties;

    the Petro-Canada Exchange Ratio represents an approximately 25% premium for the Petro-Canada Shares to the 30-day weighted-average trading price of such shares immediately prior to the announcement of the Arrangement;

    Petro-Canada Shareholders will be able to continue to participate in the growth opportunities associated with Amalco, as the combined corporation is anticipated to be a larger, stronger and more efficient company;

    RBC Dominion Securities and Deutsche Bank provided opinions, the full text of which can be found at Appendices E-1 and E-2 to this Information Circular, respectively, that, as of March 22, 2009 and subject to certain assumptions, qualifications and limitations, the Petro-Canada Exchange Ratio to be received by Petro-Canada Shareholders pursuant to the Arrangement is fair, from a financial point of view, to Petro-Canada Shareholders. See "— Petro-Canada Fairness Opinions";

    the exchange of Petro-Canada Shares for Amalco Shares will generally be tax-deferred for Petro-Canada Shareholders;

    under the Arrangement Agreement, until the time that the Petro-Canada Arrangement Resolution is approved, the Petro-Canada Board retains the ability to consider and respond to Superior Proposals on the specific terms and conditions set forth in the Arrangement Agreement;

    at least 662/3% of the votes cast by Petro-Canada Shareholders at the Petro-Canada Shareholders' Meeting are required to approve the Arrangement Resolution. Accordingly, Petro-Canada Shareholders are able to reject the Arrangement Resolution if they choose to do so;

    the Petro-Canada Shareholders have the ability to exercise their Dissent Rights; and

    the Arrangement requires approval by the Court.

        The information and factors described above and considered by the Petro-Canada Board in reaching its determinations and making its approvals are not intended to be exhaustive but include material factors considered by the Petro-Canada Board. In view of the wide variety of factors considered in connection with its evaluation of the Arrangement and the complexity of these matters, the Petro-Canada Board did not find it useful to, and did not attempt to, quantify, rank or otherwise assign relative weights to these factors. In addition, individual members of the Petro-Canada Board may have given different weight to different factors.

Wikinvest © 2006, 2007, 2008, 2009, 2010, 2011, 2012. Use of this site is subject to express Terms of Service, Privacy Policy, and Disclaimer. By continuing past this page, you agree to abide by these terms. Any information provided by Wikinvest, including but not limited to company data, competitors, business analysis, market share, sales revenues and other operating metrics, earnings call analysis, conference call transcripts, industry information, or price targets should not be construed as research, trading tips or recommendations, or investment advice and is provided with no warrants as to its accuracy. Stock market data, including US and International equity symbols, stock quotes, share prices, earnings ratios, and other fundamental data is provided by data partners. Stock market quotes delayed at least 15 minutes for NASDAQ, 20 mins for NYSE and AMEX. Market data by Xignite. See data providers for more details. Company names, products, services and branding cited herein may be trademarks or registered trademarks of their respective owners. The use of trademarks or service marks of another is not a representation that the other is affiliated with, sponsors, is sponsored by, endorses, or is endorsed by Wikinvest.
Powered by MediaWiki