CALGARY – Proxy advisory firm Institutional Shareholder Services is recommending “cautionary support” for MEG Energy’s plan to be acquired by oilsands giant Cenovus Energy.

ISS says in a report that shareholders in MEG find themselves in a dilemma because the Cenovus offer is “neither compelling nor opportunistic,” but it’s uncertain if a better bid will come.

Cenovus made its friendly offer after MEG spurned a hostile one from fellow oilsands producer Strathcona Resources.

The Cenovus offer is made up of about three-quarters cash, with the rest in equity, while Strathcona recently increased its bid and amended it to be all-stock.

ISS says the latest Strathcona bid, which MEG has also rejected, carries risks that MEG shareholders may not be able to tolerate.

Strathcona executive chair

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