(Reuters) - Canadian ministers cleared Chinese state-owned energy company CNOOC Ltd’s $15 billion bid to buy Canadian oil and gas producer Nexen Inc, allowing the largest foreign takeover by a Chinese firm to proceed.
The following is instant reaction from investors and analysts.
“When the deal was announced we thought it would eventually be approved with concessions, but that there was going to be a lot of headline risk.”
“I realize there was a lot of politics that went into this thing, but I think the overriding factor is that in order for Canada to be able to develop all those tremendous resources that they have is that they were going to need a lot of foreign capital. I think they probably played it very well, by pushing back quite a bit they were probably able to get concessions in both these deals, in Nexen and in Progress.”
On the stock volatility after the media briefing announcement:
“It was the wildest thing. I’ve been in the business 30 years and I don’t think I’ve seen one like this.”
“I mean, the idea that it was basically up all day, and then just after 2:30pm the thing totally craters.”
“I‘m not surprised that they have approved the transaction. However, what is a lot more important, I think, is just to see what the terms really are and what the policy really is in terms of how they intend to ensure net benefits for Canadians.”
“Having set a very clear precedent of giving the Chinese government whatever they like, they have assured us they won’t be able to get away with it next time.”
“Every time Canada allows oil to go outside the U.S. it’s bad for us unless you believe the EIA (U.S. Energy Information Administration) report. To me it’s a potential negative because it takes away our opportunity to get oil from an ally.”
Reporting By Anna Driver, Alastair Sharp, Jeffrey Jones and Julie Gordon