Canadian Oil Sands tells shareholders to reject Suncor bid

A pedestrian is reflected in a Suncor Energy sign in Calgary, Feb. 1, 2010. (THE CANADIAN PRESS/Jeff McIntosh)

CALGARY -- Canadian Oil Sands is again urging its shareholders to reject a takeover bid by Suncor Energy, which has set Jan. 8 as the deadline for investors.

The company (TSX:COS) sent a letter to its shareholders Tuesday in the latest back-and-forth between the two Calgary-based firms, saying it can weather prolonged low oil prices on its own and thrive once crude recovers.

The missive, a response to Suncor's renewed appeal earlier this month to accept the deal, says it's not the right time to sell Canadian Oil Sands given the low price of crude and oil stocks.

Suncor has argued that with oil prices expected to remain low for some time, the status quo is risky for COS shareholders.

Based on Suncor's most recent closing stock price Thursday, the all-stock bid is worth about $4.5 billion.

Suncor (TSX:SU) took its offer directly to COS shareholders on Oct. 5 after attempts to ink a friendly deal -- at a higher price -- were rebuffed by Canadian Oil Sands in the spring.

Both companies are partners in the massive Syncrude oilsands mine north of Fort McMurray, Alta. -- Suncor with 12 per cent and COS with 37 per cent.

Suncor is one of Canada's biggest energy companies, with vast holdings in the oilsands and thousands of employees. COS, on the other hand, has a staff of about 30 and relies on its Syncrude stake as its sole asset.