Canada not satisfied with PETRONAS bid for Progress Energy

22 October 2012 02:47  [Source: ICIS news]

TORONTO (ICIS)--Canada’s industry minister is not satisfied with PETRONAS' bid to take over Calgary-based natural gas firm Progress Energy and may block the deal, officials said over the weekend.

Industry minister Christian Paradis late Friday sent a notice to PETRONAS, advising the Malaysian state oil, gas and petrochemicals major that at this time he is not satisfied that the deal - valued at more than $5bn (€3.9bn) - would be of “net benefit to Canada”, he said.

Paradis, citing confidentiality, did not explain his reasons.

However, Paradis added that PETRONAS has an additional 30 days to make presentations or submit undertakings. "Subsequently, I will either confirm this initial decision or approve the acquisition,” he said.

Under the Investment Canada Act, the industry minister reviews large takeovers of Canadian firms by foreign investors.

Earlier this month, the minister extended his review of the planned $15.1bn takeover of Canadian oil major Nexen by China’s state-controlled China National Offshore Oil Corp (CNOOC).

In 2010, Canada blocked a bid by Anglo-Australian miner BHP for fertilizer major PotashCorp.

Before that ruling, Canada had approved more than 1,600 takeovers since the legislation came into force in 1985. Only one deal, for a satellite technology company, had been rejected for national security reasons.

($1 = €0.77)

By: Stefan Baumgarten
+1 713 525 2653

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