Canadian Oil Sands urges rejection of Suncor bid again

Canadian Oil Sands has once again urged its shareholders to reject a takeover offer by Suncor Energy, saying the purchase price is "undervalued" at around $4.5 billion.

The board ofCOS, whosemain asset is a stake in the Syncrudeoilsands project, sent a letter to shareholders urging them to reject an offer from Suncorthat would give them0.25 Suncor shares for every COS share.

"Our shareholders are telling us that now is not the time to sell. Not when oil prices are at historic lows," the letter reads.

The COS boardsays the companycan weather prolonged low oil prices on its own and thrive once crude recovers.

Suncor, which describes its offer as a "premium" for COS shares, says its offer expires on Jan.8. Based on current stock valuations, Suncor's offer values COS at about $4.5 billion.

Suncorwent over the head of COS's board and straight to shareholders only after beingpreviously rebuffed by the board with a friendly offer that was worth more on paper.

Both companies are partners in the massiveSyncrudeoilsandsmine north of FortMcMurray,Alta. Suncorwith 12 per cent and COS with 37 per cent.

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