A Quick Look at the Nexen Situation
C = Catalyst for the Stock’s Movement
Don’t get too excited. This stock isn’t going anywhere significant in the near future. Only day traders will enjoy throwing this back and forth for some miniscule gains. That being the case, this isn’t about whether or not Nexen is a good opportunity. It’s more about taking a look at the current situation as well as the company’s numbers versus its acquirer’s numbers. This could potentially lead you to taking a look at CNOOC Ltd. (NYSE:CEO). On the other hand, it might also lead you to steer clear of CNOOC.
Nexen is a Canadian energy producer that explores for, develops, and produces oil and natural gas from conventional sources. Since this a Canadian company that is being acquired by a Chinese company, you might be wondering why the Committee on Foreign Investments in the United States had to approve the deal. It’s because of Nexen’s Gulf of Mexico oil and gas operations. A $15.1 billion takeover bid was approved by Canada back in December. Britain and the European Union also approved the deal. Now that CFIUS gave the nod, the deal is expected to go through during the week of February 25.
Let’s take a look at some numbers…