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New Offering - Cenovus Energy Inc question?

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  • Mar 30th, 2017 10:41 pm
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[OP]
Deal Fanatic
Oct 1, 2004
6561 posts
924 upvotes
Toronto

New Offering - Cenovus Energy Inc question?

TD Direct Investing would like to inform you that the following New Issue has just been announced.

Cenovus Energy Inc.
received this today

Short Description: Treasury Offering of Common Shares via Bought Deal
Price: $16.00 CDN per share.
Settlement: On or about April 6, 2017.

You are deemed to have received the prospectus as they are available
to you on WebBroker. No physical copies of the prospectus will be
mailed automatically, however you may request one from one of our Investment Representatives.

Currently Cenovus price $17.45, if I express interest to the above, that means I can't lose unless the shares drop 10% within a week? Shouldn't the offering be closer to the market price?
9 replies
Deal Fanatic
User avatar
Dec 21, 2005
5616 posts
1024 upvotes
London, ON
greg123 wrote: TD Direct Investing would like to inform you that the following New Issue has just been announced.

Cenovus Energy Inc.
received this today

Short Description: Treasury Offering of Common Shares via Bought Deal
Price: $16.00 CDN per share.
Settlement: On or about April 6, 2017.

You are deemed to have received the prospectus as they are available
to you on WebBroker. No physical copies of the prospectus will be
mailed automatically, however you may request one from one of our Investment Representatives.

Currently Cenovus price $17.45, if I express interest to the above, that means I can't lose unless the shares drop 10% within a week? Shouldn't the offering be closer to the market price?
No one is guaranteeing anything -- oil prices can tank and/or the underlying facilities could explode

They had to offer the ~10% discount to entice people to buy
:idea: :) :lol: :razz: :D
[OP]
Deal Fanatic
Oct 1, 2004
6561 posts
924 upvotes
Toronto
This is obviously a steal if I was interested in buying at the current price regardless correct?

does "Treasury Offering of Common Shares via Bought Deal" mean the company is issuing additional shares?
Sr. Member
Feb 17, 2009
609 posts
28 upvotes
Brockville
They are trying to fund their recent 18 billion dollar purchase. The amount of shares they are issuing will dilute their shares from the current price likely down to the price being offered. It doesnt mean it won't go back up in time but I wouldn't expect a 10% gain the day TD settles the trade
Deal Fanatic
May 22, 2003
7719 posts
4713 upvotes
Vancouver
greg123 wrote: This is obviously a steal if I was interested in buying at the current price regardless correct?

does "Treasury Offering of Common Shares via Bought Deal" mean the company is issuing additional shares?
When the markets open tomorrow, the stock price will drop close to the offering price.
Member
Oct 12, 2016
309 posts
73 upvotes
Jermyzy wrote: When the markets open tomorrow, the stock price will drop close to the offering price.
And they did.
Sr. Member
Aug 16, 2015
920 posts
356 upvotes
Anyone buy his dip???

Looks quite nice honestly
Sr. Member
Nov 4, 2012
743 posts
234 upvotes
Oil sand / natural gas. (My house doesn't use natural gas)
6.xx Billion in debt
Equity quarterly shrinking
Divvy at 0.26/share

You make the choice.
Deal Fanatic
May 22, 2003
7719 posts
4713 upvotes
Vancouver
The fact that the SP dropped below the offering price reflects overall investor sentiment on this move.
Banned
Mar 20, 2017
21 posts
5 upvotes
A company that's losing money issuing more shares at a lower price to raise funds to take over another company that's losing money.

What's not to like about that? Smiling Face With Open Mouth

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