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What happened?
Canada's Suncor Energy (NYSE: SU) has gained an important ally in its bid to acquire Canadian Oil Sands: the target company itself. The two companies have reached an agreement to support the latest offer made by Suncor Energy, specifically the exchange of 0.28 of a Suncor Energy share for each Canadian Oil Sands share. All told, this will cost Suncor Energy the equivalent of roughly 4.2 billion in Canadian dollars ($2.9 billion).

The new bid is an improvement over the previous offer of 0.25 of a Suncor Energy share per Canadian Oil Sands Share. That would have equated to around 3.8 billion in Canadian dollars ($2.6 billion).

The revised offer will remain open until Feb. 5, and is subject to at least 51% of Canadian Oil Sands shares being tendered.

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Does it matter?
With the nose-dive in oil prices, now is an ideal time to shop for distressed assets. Canadian Oil Sands doesn't quite fit that category, but like other energy companies it's been struggling: In its most recently reported quarter, it plunged well into a loss, booking a $119 million net shortfall for the period.

Suncor Energy has been weathering the oil price storm better than most, as its vertically integrated business model protects it somewhat from the vagaries of the price of oil. It also helps that the company runs a tight financial ship, managing its cash very effectively and managing to save when it counts.

It's exactly the kind of company that would succeed in buying a big peer using only its stock, which greatly reduces strain on the balance sheet. That in itself is a win, and the fact that such a purchase will almost certainly land a big, productive asset like Canadian Oil Sands is very much a positive for Suncor Energy shareholders.

Eric Volkman has no position in any stocks mentioned. Nor does The Motley Fool. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.