CNOOC, Nexen resubmit takeover proposal to U.S. committee on foreign investment

CALGARY – Calgary’s Nexen Inc. and the Chinese state-owned company seeking to buy it have withdrawn and resubmitted a notice about the proposed $15-billion acquisition to the U.S. Committee on Foreign Investment.

Nexen said Tuesday that the company and its bidder, China National Offshore Oil Co., did so under “mutual agreement” with the committee.

“Discussions with CFIUS continue, with a view to completing the CFIUS review process as expeditiously as possible,” Nexen said in a brief statement.

Although Nexen (TSX:NXY) is based in Canada, it has offshore holdings in the U.S. Gulf of Mexico and CNOOC said the deal requires approval from regulators in the U.S.

U.S. politicians on both sides of the aisle have cautioned Ottawa against turning over natural resources to a Chinese state-owned company. Critics fear that CNOOC may answer more to Beijing than it does to the market.

Industry Minister Christian Paradis is in the midst of deciding whether the deal would be of net benefit to Canada. The review period, which has been extended twice so far, is to end on Dec. 10, though it can be extended again with CNOOC’s consent.

The Conservative government has said it will clarify its foreign investment guidelines shortly.

In an apparent bid to ease Ottawa’s concerns, CNOOC has pledged to keep the head office in Calgary, seek a listing on the Toronto Stock Exchange and place some $8 billion of its assets under the control of Nexen’s management in Canada.

It has also promised to carry on Nexen’s social responsibility programs in Canada and around the world.

Looking for more?

Get the Best of Maclean's sent straight to your inbox. Sign up for news, commentary and analysis.