Husky deal not the trigger for Canadian consolidation wave

M&A activity may have started to rally, but further big-ticket transactions look unlikely

Dealmaking has been picking up in the Canadian oil patch after stumbling to a record low level in the first half of the year. And late October saw a significant fillip to the trend when Canadian oil firm Cenovus Energy bid C$3.8bn (US$2.89bn)—C$10.2bn including debt—to acquire Albertan peer Husky Energy. But the blockbuster deal, the sixth-largest in Canadian history, may be a one-off. The move was based on a decision by Husky’s majority owner, not a result of financial necessity like other recent deals in the low oil price environment. Funding options, whether debt or equity, have largely dried up for all but the largest E&P companies, making another major consolidation between Canada’s