NEW YORK -- China's Sinopec International Petroleum Exploration and Production Corp. said Sunday that it has agreed to buy Canadian oil and gas company Daylight Energy Ltd. (DAY:Toronto) for about 2.2 billion Canadian dollars (or $2.1 billion).

The purchase price amounts to a 43.6% premium over the average price of Daylight's shares over the 60 days that ended Friday, the company said.

That works out to about C$10.08 a share. Daylight's shares ended trading Friday on the Toronto Stock Exchange at C$4.59.

Daylight Energy is based in Calgary, Alberta. It explores for crude oil and natural gas liquids at sites in Alberta and northeast British Columbia.

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Sinopec International is a unit of China Petrochemical Corp. ( SNP), which is owned by Sinopec Group, the largest shareholder of petroleum and petrochemical giant Sinopec Corp. -- China's second-largest producer of crude oil.

"We are very pleased to announce this transaction and the considerable value it brings to our securityholders," said Anthony Lambert, Daylight's president and CEO.

The transaction must be approved by Daylight's shareholders. The company's board is unanimously backing the sale, with directors and officers and have agreed to vote their combined 6.7 million shares in favor of the transaction.

The deal includes a breakup fee of C$100 million.

Due to the proposed sale of the company, Daylight has suspended future dividends. The company said it will pay a previously announced 5 cent Canadian dividend on Oct. 17 to shareholders of record on Sept. 30.
Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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