By Adria Calatayud

TotalEnergies SE said Thursday that it has decided to sell its TotalEnergies EP Canada Ltd. business to Suncor Energy Inc. for up to 6.1 billion Canadian dollars ($4.47 billion) instead of spinning it off.

The French energy giant said it signed an agreement with Suncor, under which it would receive C$5.5 billion in cash at closing and additional payments that could amount to C$600 million subject to meeting specific conditions.

In light of the proceeds from the sale, TotalEnergies said it intends to distribute at least 40% of its cash-flow generation this year to shareholders, either through share buybacks or a special dividend. This is at the top end of the company's previous guidance.

TotalEnergies said it received several unsolicited offers for its Canadian oil-sands assets after it disclosed its spinoff plan and that its board considered a sale a more straightforward move. The price is comparable to the valuation of C$5 billion-C$6 billion valuation TotalEnergies targeted for the initial listing of the spinoff, it said.

The deal is expected to be completed by the end of the third quarter, subject to customary closing conditions, TotalEnergies said.

Write to Adria Calatayud at adria.calatayud@dowjones.com

(END) Dow Jones Newswires

April 27, 2023 02:51 ET (06:51 GMT)

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