Safe bet: outgoing Nexen chief executive Charlie Fischer
Nexen ‘safe from hostile bids’
Charlie Fischer, outgoing chief executive of Canadian oil producer Nexen said today he does not expect the company to easily succumb to any hostile takeover.
Fischer, 58, will retire from Canada's fourth-largest independent at the end of the year after seven years as chief executive. Marvin Romanow, the chief financial officer, will then take the top job.
Fischer announced his retirement as the Financial Times reported yesterday that a number of major oil companies could be eyeing Nexen as an acquisition target.
While he said he could not prevent a hostile takeover, he said any buyer would pay a steep price for what he called Nexen's "world-class" assets in Canada's oil sands, the Gulf of Mexico, Yemen, Britain's North Sea and elsewhere.
"There's nothing in place stopping anybody from initiating a hostile (takeover) but anybody who does won't be happy with the process," he said in an interview. "Because if you're going to disappear the only thing that matters is the price.... If someone wants to take a run at us they better be ready for a fight, and the best price wins.”
Fischer said Nexen would likely go to an auction process if a hostile bidder made an attempt to buy the company.
"It might even get busted up going to auction because what we're going to do is get the best value for shareholders," he said.
The company's stock jumped C$2.35, or 14.5%, to C$18.60 on the Toronto Stock Exchange on Wednesday as oil prices rose and Nexen reported its third-quarter profit more than doubled, Reuters reported.
But Nexen shares, which reached a high of C$43.45 in June, have fallen back sharply since then as the oil price retreated from its record peak this summer and the financial crisis cut investor confidence.
Despite the drop by the shares, Fischer said he believes he is leaving the company in good shape. Its C$6.1 billion Long Lake oil sands project is set to begin producing synthetic crude within weeks.
As well, it has a strong position in the emerging shale gas area of north-eastern British Columbia, promising finds in the Gulf of Mexico and big production from its Buzzard field in the North Sea.