Chevron To Buy Anadarko In $33B Deal

Chevron To Buy Anadarko In $33B Deal

The acquisition comes as the USA has reversed a decades-long decline in oil production, thanks to new technology that has allowed it to tap hitherto unreachable, so-called "tight oil", that had been locked deep beneath the surface in shale rock. Anadarko's stock surged on the news. Chevron shares were down 4.2% from Thursday's close of $125.99 a share.

Anadarko shareholders will receive 0.3869 shares of Chevron and US$16.25 in cash for each share they own, or US$65 per share.

The $65-per-share offer was structured as 75 percent stock and 25 percent cash, and the company will also take on $15 billion of Anadarko's debt.

Chevron's chairman and CEO, Michael Wirth, celebrated the agreement as a transaction that "builds strength on strength for Chevron". The combined company's cash flow a year ago, US$36.5 billion, would have exceeded Exxon's.

Analysts predict further consolidation as the smaller companies that revolutionized the industry through advances in horizontal drilling and hydraulic fracking have seen their stock prices languish and have curtailed spending due weak returns.

As oil companies have become more efficient at producing shale oil, which has changed the global equation by making US oil a rival against the cheap oil produced by Organization of the Petroleum Exporting Countries. The company said will boost its share repurchase rate by US$1 billion to US$5 billion per year upon closing of the deal.

Chevron will have greatly expanded access to assets as a result of the combination.

In oil and gas production terms, the deal puts Chevron neck-and-neck again with Royal Dutch Shell Plc for the title of the second-largest integrated major oil company, slightly behind Exxon. It's also a major producer in the Gulf of Mexico.

Chevron, which already has 2.3 million acres in the Permian Basin, said the combined company would have a 75-mile (120-km)-wide corridor across the Permian's DE basin, on the Texas-New Mexico border.

Dozens arrested in U.S. sex trafficking sting
During the week leading up to this year's Super Bowl in Atlanta, authorities arrested 169 people in a sex-trafficking sting. Investigators would then arrange a meeting place and arrest the suspects as they arrived for an encounter.

American tabloid National Enquirer put up for sale
AMI's stable of titles that are not up for sale include Us Weekly , OK, Star, In Touch, Men's Journal , and Muscle & Fitness. American Media recently refinanced hundreds of millions of dollars of debt after years of heavy borrowing and acquisitions.

Koepka, DeChambeau get hot, tied atop Masters
Also headed home early were 2017 Masters champion Sergio Garcia, 2016 victor Danny Willett and recent Valspar champ Paul Casey . The four-time victor of the green jacket was just two shots back of lead after the impressive birdie.

As of February 2018, Anadarko was the largest oil and gas producer in Weld County. That is at the heart of Chevron's Permian strategy.

Anadarko has always been rumoured to be a takeover target of the world's largest oil companies, offering a suite of assets including a massive LNG facility in Mozambique that is racing against an Exxon Mobil Corp. project to be first to be operational in the country.

The combination will create 75-mile-wide corridor in the oil-rich Permian and add to Chevron's already significant natural gas holdings, which extend from its giant Gorgon field off the northwest coast of Australia to Africa and the United States. He estimated Chevron is paying about $50,000 an acre for Anadarko's west Texas holdings.

The deal is expected to close in the second half of the year. Chevron fell as much as 5.6 per cent.

Chevron said it is an opportunity to "high-grade" its portfolio and plans to divest between £11.4bn and £15.2bn of assets between 2020 and 2022, with proceeds used to reduce debt and return cash to shareholders.

Chevron said the deal would add to its free cash flow and profit one year after closing, if Brent crude, now around $70, holds above $60 per barrel.

Credit Suisse Securities is Chevron's financial adviser, while Paul, Weiss, Rifkind, Wharton & Garrison is its legal adviser. Evercore Inc. and Goldman Sachs Group Inc advised Anadarko alongside law firms Wachtell, Lipton, Rosen & Katz and Vinson & Elkins LLP.

The acquisition is however subject to Anadarko shareholder approval and regulatory approvals and other customary closing conditions.

Related Articles

  • Magic Johnson Resigns as Los Angeles Lakers President

    Magic Johnson Resigns as Los Angeles Lakers President

    They continue to be linked to Davis, who is represented by agent Rich Paul of Klutch Sports, a longtime friend of James. After signing LeBron James last summer, Johnson said that the Lakers' process would take multiple summers.
    Star Wars Episode 9 has officially been given a title

    Star Wars Episode 9 has officially been given a title

    And, according to The Huffington Post , the idea of her being Palpatine's daughter or family member fits " Star Wars " tropes. I was pretty emotional from the panel leading into it and then when the trailer kicked off I was just so thrilled.
    Homeless vet in GoFundMe scam involving NJ couple gets probation

    Homeless vet in GoFundMe scam involving NJ couple gets probation

    D'Amico and McClure were charged last fall in state court with theft and conspiracy but have yet to be indicted by a grand jury. A sentencing date has not yet been set for either Bobbitt or McClure on those federal charges.
  • Woman charged for damaging neighbour's racy Easter display

    Woman charged for damaging neighbour's racy Easter display

    He did not elaborate on his relationship with the woman but said she and her son live at the home with him. Gangi said he thinks she appears to have been seeking attention rather than justice due to moral outrage.
    Pope kisses feet of South Sudan leaders, urges them to keep peace

    Pope kisses feet of South Sudan leaders, urges them to keep peace

    In a report by Reuters, it was gathered that the event played out Thursday, April 11, during the pope's short retreat at the Vatican.

    Sean Payton on Dallas rumors: I’ve got fleur-de-lis tattoos

    Unfortunately, it turned out the family split was the beginning of the end of Payton's 20-year marriage to Beth Shuey Payton. Basically, Payton pointed out that the Cowboys rumor is something that he's had to deal with for the past few seasons.
  • Comedians pay tribute to Ian Cognito after stand-up comic dies onstage

    Comedians pay tribute to Ian Cognito after stand-up comic dies onstage

    The stand-up comic fell ill at the Atic bar in Bicester, Oxfordshire, where the Lone Wolf Comedy Club was being held. He was always kind to me when I started out, and brilliant and provocative and entirely original onstage.
    South Korea abortion ban must be lifted, judges order

    South Korea abortion ban must be lifted, judges order

    Three other justices went further and ruled the abortion ban unconstitutional, demanding that it lose its legal power immediately. Police control supporters and opponents of a law on abortion outside the constitutional court in Seoul on April 11.
    Obama White House counsel may be indicted for alleged Ukrainian lobbying

    Obama White House counsel may be indicted for alleged Ukrainian lobbying

    The investigation into Craig comes as the Justice Department is cracking down on unregistered foreign lobbying and consulting. In January this year Skadden agreed to pay $4.6 million to settle charges it lobbied illegally for Ukraine.
  • Israel Folau is to be sacked by Rugby Australia: here's why

    Israel Folau is to be sacked by Rugby Australia: here's why

    Israel Folau is fighting to keep his professional career alive after a secret meeting with rugby officials was caught on camera. Israel Folau's rugby career now hangs in the balance following his latest homophobic outburst on social media .
    Julian Assange settles in London prison

    Julian Assange settles in London prison

    Assange is due to face Westminster Magistrates Court on May 2 via a video-link from prison over the United States extradition case.
    The Rise of Skywalker: Star Wars Episode IX title revealed

    The Rise of Skywalker: Star Wars Episode IX title revealed

    Check out the first look below! He also answered the question of who's a better pilot- Poe or Solo . Anthony Daniels wrote a memoir! The trailer ends with the haunting laugh of Emperor Palpatine.