New York: US oil giant Chevron announced Friday it had agreed to acquire all outstanding shares of Anadarko in a stock and cash transaction valued at $33 billion, or $65 per share.
Based on Chevron's Thursday closing price, Anadarko shareholders will receive 0.39 shares of Chevron and USD16.25 in cash for each Anadarko share held, the company said in a statement.
The total enterprise value of the transaction is USD50 billion.
"The acquisition of Anadarko will significantly enhance Chevron's already advantaged Upstream portfolio and further strengthen its leading positions in large, attractive shale, deepwater and natural gas resource basins," the company said.
"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 LNG 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."
Anadarko Chairman and CEO Al Walker added: "The strategic combination of Chevron and Anadarko will form a stronger and better company with world-class assets, people and opportunities."
The deal is the oil industry's largest since Royal Dutch Shell bought BG Group in 2016, and it sparked speculation that other shale producers are in play. Shares of Apache Corp, which also has extensive acreage in the Permian Basin, jumped 7 percent in premarket trading, while Pioneer Natural Resources Co rose 6 per cent.
US crude oil production now surpasses 12 million barrels a day (bpd), and the nation is the third-largest producer of liquefied natural gas (LNG), the super-cooled fuel that is seeing record demand as a cheaper, cleaner alternative for countries that still rely heavily on coal for power generation.
Chevron, which already has 2.3 million acres in the Permian Basin, said the deal to buy Anadarko would give the combined company a 75-mile (120-km)-wide corridor across the Permian's Delaware basin, on the Texas-New Mexico border. Anadarko also has a Mozambique LNG project, part of one of the industry's largest planned current investments.
Chevron Chief Executive Michael Wirth will lead the combined company after the deal closes. Chevron will remain headquartered in San Ramon, California. Credit Suisse Securities (USA) LLC is Chevron's financial adviser, while Paul, Weiss, Rifkind, Wharton & Garrison LLP is its legal
adviser.