US oil giant Chevron said on Monday (Oct 23) that it agreed to buy its competitor Hess Corp for $53 billion in stock. According to a report by the news agency Reuters, this is the second proposed mega-merger among the biggest American oil players following Exxon Mobil's bid for $60 billion for Pioneer Natural Resources earlier this month.&nbsp;

The report said that the deal signals Chevron's plans to continue boosting investments in fossil fuels as the oil demand remains strong and big producers use acquisitions to replenish their inventory after years of under-investment.&nbsp;

Chevron has offered 1.025 of its shares for each Hess share held, or $171 per share, implying a premium of about 4.9% to the stock's last close.

Reuters reported on Monday that Chevron's shares were trading 3% lower premarket. RBC analysts said that they were surprised by the deal's timing and expected the company to bide its time after Exxon's deal for Pioneer.

Hess Corp's chairperson John Hess is expected to join Chevron's board of directors once the deal closes in the first half of 2024. The combined venture is expected to grow production and free cash flow faster and for longer than Chevron's current five-year guidance.&nbsp;

The (Chevron) deal has raised the competition between Chevron, the number 2 oil and gas producer behind Exxon, putting it in direct competition with its biggest rival to develop drilling in Guyana.

Guyana, a country in South America, has become a major oil producer in the region following huge discoveries in recent years. Exxon and partners Hess and China's CNOOC are the only active producers in the country.&nbsp;

(With inputs from agencies) 
 
 
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US oil giant Chevron said on Monday (Oct 23) that it agreed to buy its competitor Hess Corp for $53 billion in stock. According to a report by the news agency Reuters, this is the second proposed mega-merger among the biggest American oil players following Exxon Mobil's bid for $60 billion for Pioneer Natural Resources earlier this month.

US oil giant Chevron said on Monday (Oct 23) that it agreed to buy its competitor Hess Corp for $53 billion in stock. According to a report by the news agency Reuters, this is the second proposed mega-merger among the biggest American oil players following Exxon Mobil's bid for $60 billion for Pioneer Natural Resources earlier this month. The report said that the deal signals Chevron's plans to continue boosting investments in fossil fuels as the oil demand remains strong and big producers use acquisitions to replenish their inventory after years of under-investment. Chevron has offered 1.025 of its shares for each Hess share held, or $171 per share, implying a premium of about 4.9% to the stock's last close. Reuters reported on Monday that Chevron's shares were trading 3% lower premarket. RBC analysts said that they were surprised by the deal's timing and expected the company to bide its time after Exxon's deal for Pioneer. Hess Corp's chairperson John Hess is expected to join Chevron's board of directors once the deal closes in the first half of 2024. The combined venture is expected to grow production and free cash flow faster and for longer than Chevron's current five-year guidance. The (Chevron) deal has raised the competition between Chevron, the number 2 oil and gas producer behind Exxon, putting it in direct competition with its biggest rival to develop drilling in Guyana. Guyana, a country in South America, has become a major oil producer in the region following huge discoveries in recent years. Exxon and partners Hess and China's CNOOC are the only active producers in the country. (With inputs from agencies) WATCH WION LIVE HERE You can now write for wionews.com and be a part of the community. Share your stories and opinions with us here.

Chevron to buy competitor Hess Corp for $53 billion

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Chevron to buy competitor Hess Corp for $53 billion