CK Hutchison-backed (HKG:0001) Cenovus Energy agreed to acquire upstream oil and gas producer MEG Energy in a cash and stock transaction valued at C$7.9 billion, according to a statement Friday.

The firm will pay C$27.25 per MEG share, comprised of C$20.44, or 75%, in cash and 0.33125, or 25%, as a Cenovus share.

MEG shareholders can also opt to receive the consideration fully in cash or as Cenovus stock.

Cenovus Energy will fund the deal via a C$2.7 billion loan facility and a C$2.5 billion bridge facility, it said.

The transaction is approved by the boards of both companies and is expected to close in the fourth quarter of 2025.