Tamarack, Headwater forge Canada's Clearwater oil leader with $7.25 billion merger (updated)

Tamarack Valley Energy

08/09/2026 10:17

Headwater shareholders get one Tamarack share each
Tamarack plans 20% dividend increase to C$0.06/share
Companies plan to spin off non-core assets into new listed firm
Adds shares and deal details in paragraphs 4-13
By Vallari Srivastava
Sept 8 (Reuters) - Canadian oil producers Tamarack Valley TVE.TO and Headwater Exploration HWX.TO will merge in an all-stock deal valued at C$10 billion ($7.25 billion), the companies said on Tuesday.
The deal would create the largest publicly traded oil producer focused on Alberta's Clearwater Formation, with the combined core land position across Marten Hills, Nipisi and Marten Hills West.     
Headwater shareholders will receive one Tamarack share for each share held, with Tamarack issuing about 237.8 million shares. Tamarack shareholders will own 66.5% of the combined company, while Headwater shareholders will own 33.5%.
In connection with the transaction, Tamarack plans to increase its quarterly dividend by 20% to C$0.06 per share, President Steve Buytels said.
Buytels added that the company's five-year plan now includes Clearwater growth of 10%-12%, up from 8%-10% prior to the transaction.   
Tamarack Valley's shares rose over 4%, while Headwater was up nearly 2%.
Separately, Tamarack said Buytels will become CEO and join the board of the combined company on January 1, 2027, while founding CEO Brian Schmidt will become executive chairman.
The transaction is expected to close in the fourth quarter, following which Tamarack plans to accommodate expected growth in its Clearwater production through existing and planned pipelines to Edmonton, Alberta.
These expanded options provide Tamarack with an opportunity to mitigate the risk of local capacity constraints and obtain greater exposure to diversified oil markets, it said in a statement.

COMBINED COMPANY TO SPIN OFF NON-CORE ASSETS
Tamarack and Headwater said they plan to transfer certain non-core exploration assets into Tributary Exploration Inc, a new publicly listed firm to be run by Headwater's current management team with Headwater CEO Jason Jaskela as the top boss.
The assets include some Mannville-stack exploratory mineral rights in Alberta, prospective thermal heavy oil opportunities at Handel, Saskatchewan, and legacy McCully natural gas production in New Brunswick.
Tributary's common shares will initially be distributed to the shareholders of both Tamarack and Headwater, with Tamarack owning a majority of them.


($1 = 1.3799 Canadian dollars)

 (Reporting by Vallari Srivastava in Bengaluru; Editing by Sherry Jacob-Phillips, Vijay Kishore and Maju Samuel)
 ((Srivastava.Vallari@thomsonreuters.com;))