Chevron Expands In Permian Plans to Buy Anadarko

The deal, when finalized, would make Chevron the largest producer in the Permian, unless of course Chevron is outbid before the deal is closed

 

April 12, 2019

 

In a surprise announcement on Friday, Chevron says it plans to buy Anadarko Petroleum for $33 billion in cash and stock — $50 billion in enterprise value, counting debt.

Both companies have approved the deal, which is expected to be finalized later this year — which leaves open the possibility that another suitor could outbid Chevron for the Houston company.

The California company will pay $65 a share to Anadarko shareholders, who will in turn receive 0.3869 a share of Chevron and $16.25 in cash for each Anadarko share, an arrangement that brings Chevron strongly into shale play along with Gulf of Mexico deepwater and increased overseas activity in Anadarko’s LNG project in Mozambique and it’s huge production in Algeria.

Chevron CEO Michael Wirth said on Friday that his company has been in talks with Anadarko for weeks.

With the merger, “we will now see Chevron emerging as the clear leader among all Permian players, both in terms of production growth and as a cost leader,” Rystad Energy‘s Per Magnus Nysveen told NPR this afternoon.