Chevron to acquire Anadarko for $33bn in stock, cash

12th April 2019 By: Bloomberg

Chevron Corp will acquire Anadarko Petroleum Corp for $65 a share, the company said in a statement. Anadarko shareholders will receive 0.3869 shares of Chevron and $16.25 in cash for each Anadarko share.

Chevron will issue 200-million shares and pay $8-billion in cash. The company will also assume about $15-billion of net debt.

Chevron expects the deal to add to free cash flow and earnings per share one year after closing. The company will boost its share repurchase rate by $1-billion to $5-billion a year upon closing of the deal.

The transaction is expected to achieve run-rate cost synergies of $1-billion before tax and capital spending cuts of $1-billion within a year of closing.

“This transaction builds strength on strength for Chevron. The combination of Anadarko’s premier, high-quality assets with our advantaged portfolio strengthens our leading position in the Permian, builds on our deepwater Gulf of Mexico capabilities and will grow our liquefied natural gas business. It creates attractive growth opportunities in areas that play to Chevron’s operational strengths and underscores our commitment to short-cycle, higher-return investments,” Chevron chairperson and CEO Michael Wirth says.

The combined company will continue to be led by Wirth as chairperson and CEO and will remain headquartered in San Ramon, California.