MEG announced its rejection of the offer, which it said undervalued the company, in a statement Wednesday.

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MEG is seeking to draw out other potential buyers who may be interested in its Christina Lake project, which produces roughly 90,000 barrels a day and is considered one of Canada’s top-tier oil-sands operations. Oil-sands giants Suncor Energy Inc., Imperial Oil Ltd. and Canadian Natural Resources Ltd. are potential rival suitors, Eight Capital analyst Phil Skolnick said earlier this month. Husky Chief Executive Officer Rob Peabody took his cash-and-stock proposal directly to shareholders after MEG’s board spurned an earlier offer. Both sides first discussed a potential merger in May, according to Husky’s bid circular. The pursuit of MEG is happening against a backdrop of plunging Canadian crude prices. Western Canada Select crude has traded at a record discount to West Texas Intermediate in October as rising oil-sands oil rig flanges gulf coast production bumps up against pipeline bottlenecks and maintenance at U.S. refineries.

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At the time of its announcement, Husky’s all-stock offer valued MEG at C$11 a share, 37 percent more than the stock’s previous close. The deal would also include Husky assuming C$3.1 billion of MEG’s debt. Much of the projected C$200 million in savings from the deal would come from Husky refinancing MEG’s borrowings at lower rates.

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