By Christopher Bjork 

MADRID-- Repsol SA is preparing an US$8.3 billion bid for Canada's struggling Talisman Energy Inc., a takeover that would roughly double the Spanish company's oil output right away and boost its potential for further expansion.

The Madrid company's board met Monday evening and unanimously approved the offer, which has an enterprise value of $13 billion including debt. Repsol said it was preparing to offer $8 a share for Talisman, a significant premium over the Calgary-based company's closing price Friday.

A spokesman for Talisman had no immediate comment on the bid Monday afternoon. In New York, Talisman rose 19% to $5.12. But the shares are still down about 56% so far this year.

A takeover of Talisman would allow Repsol to control assets that include oil rigs in the North Sea and off the coasts of Indonesia and Malaysia, and shale acreage in Texas, New York and Alberta.

Taking on Talisman's 2,809 employees would nearly double Repsol's exploration and production staff. While the Spanish company has a market value five times as big as Talisman's, it remains a tiny competitor in oil production and for more than a year has been shopping for an acquisition that would bolster its production capacity.

Historically a refiner, Repsol has in recent years acquired stakes in several of the world's largest oil finds. But its production unit lacks the scale and expertise needed to develop promising fields offshore in Brazil and the Gulf of Mexico.

A near-halving of oil prices since June has squeezed smaller energy companies, which are recording dwindling revenues and struggling to fund new exploration. Talisman is no exception.

Repsol, meanwhile, is cash rich and short on assets. It received $5 billion in compensation for the 2012 expropriation of its Argentine unit YPF SA, and last year sold its liquid-natural-gas unit.

The sharp slide of oil prices is "a great opportunity for anyone who is liquid, and has not been hurt too badly by this drawdown," said Michael Hulme, a fund manager with Carmignac Gestion who manages a commodities fund with ownership in several U.S. and Canadian oil and natural-gas explorers. "There is a state of near-panic among many oil producers, particularly in the U.S.," he said, and a "tableau of middle-ranking oil companies in situations of potential stress."

Repsol and Talisman first flirted with a deal during the summer, but talks cooled because of differences over price. As oil prices sank, Repsol started to look elsewhere for a deal, while Talisman's share price sank.

In early November, Repsol's chief financial officer, Miguel Martínez, signaled to investors that the company was still keen to make an acquisition, and that it expected the oil-price plunge to serve up better opportunities.

Around that time, with oil prices in free fall, Talisman put out new feelers with Repsol, asking whether the company would be willing to resume talks on a deal, according to a person familiar with the talks.

Repsol demurred before agreeing and talks moved quickly over the past 10 days. Repsol executives traveled to Calgary last week to discuss a potential bid.

On Monday, Repsol's board approved its offer. By that time, Talisman had lost more than half its market value from the start of the year. Oil prices had fallen more than 45% and remained close to multiyear lows.

Chester Dawson in Calgary contributed to this article.

Write to Christopher Bjork at christopher.bjork@wsj.com

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