On Tuesday, shareholders of Hess Corporation approved the proposed $53 billion merger with Chevron Corporation, paving the way for the second-largest US oil corporation to acquire crucial assets and have a position in Exxon Mobil's enormous Guyana finds.<o:p></o:p>

The shareholder approval eliminates a significant barrier, but the transaction still requires regulatory approval and must resolve a protracted arbitration dispute with Exxon Mobil and CNOOC, Hess's Guyana partners. According to Frederic Boucher, a risk arbitrage analyst at Susquehanna Financial Group, regulatory clearance could be granted next month, which coincides with the Federal Trade Commission's (FTC) recent approval of Exxon's acquisition of Pioneer Natural Resources.<o:p></o:p>

The most important remaining hurdle is to resolve the lawsuit launched by Exxon and CNOOC, who claim first refusal on any sale of Hess's Guyana holdings. The purchase required a majority of the 308 million outstanding Hess shares to be approved, and preliminary results indicate support, though Hess has yet to release the vote total.<o:p></o:p>

This decision represents a big triumph for CEO John Hess, who has put his reputation and the heritage of his father's company at stake by pursuing this merger. The outcome alleviates demands from some shareholders seeking more compensation for the sale's delay. Exxon's arbitration proceedings could push the deal's closing date into 2025.<o:p></o:p>

"We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction and look forward to the successful completion of our merger with Chevron," Hess stated in a statement.<o:p></o:p>

Following the decision, Hess stock jumped marginally to $152.05, while Chevron stock rose by less than 1 per cent to $159.04.<o:p></o:p>

"Assuming Chevron wins the arbitration against Exxon or reaches a settlement, the transaction will now proceed," said Mark Kelly, an analyst with MKP Advisors. The merger has substantial consequences for both companies. Chevron’s acquisition of the lucrative Guyana oilfields from Hess could help minimise geopolitical concerns linked with the TengizChevroil project in Kazakhstan, which predominantly delivers oil through Russia to the Black Sea.<o:p></o:p>

Additionally, this acquisition could counterbalance the cost overruns at Chevron's Australian liquefied natural gas (LNG) projects, which have been plagued by labour and operational concerns. Acquiring Hess' Guyana holdings would increase Chevron's oil and gas reserves while also providing a new growth path beyond its present activities in the United States and Central Asia, according to Morningstar analyst Allen Good.<o:p></o:p>

Hess shareholders will control approximately 15 per cent of the larger Chevron corporation and will be eligible to receive its dividend, which is four times more than Hess' present payout.<o:p></o:p>

The shareholder vote boosts Hess's negotiating stance with Exxon. While Exxon has expressed no interest in acquiring Hess as a whole, it has not ruled out the prospect of bidding for Hess' Guyana assets.<o:p></o:p>

"It's beneficial that Chevron cleared this hurdle amid uncertainty over the Guyana arbitration," said Good. "However, I don't think it will affect the outcome of Exxon's claim."<o:p></o:p>

A spokesperson for Chevron stated that the company intends to complete the FTC regulatory procedure in the coming weeks. "We are confident our position on the preemption right will be affirmed in arbitration," the organisation stated.<o:p></o:p>

Exxon is the sole producer in Guyana, with 45 per cent ownership in the Stabroek Block and CNOOC holding a 25 per cent interest. Both corporations claim first refusal on any sale of Hess's 30 per cent interest.<o:p></o:p>

Institutional Shareholder Services, a proxy consulting firm, had advised shareholders to abstain and encouraged Hess to offer incentives considering the deal's delays. According to sources familiar with the situation, John Hess spent the previous month lobbying significant shareholders for support, personally visiting, or calling more than 30 companies.<o:p></o:p>

(With inputs from Reuters)<o:p></o:p>

On Tuesday, shareholders of Hess Corporation approved the proposed $53 billion merger with Chevron Corporation, paving the way for the second-largest US oil corporation to acquire crucial assets and have a position in Exxon Mobil's enormous Guyana finds.

On Tuesday, shareholders of Hess Corporation approved the proposed $53 billion merger with Chevron Corporation, paving the way for the second-largest US oil corporation to acquire crucial assets and have a position in Exxon Mobil's enormous Guyana finds. The shareholder approval eliminates a significant barrier, but the transaction still requires regulatory approval and must resolve a protracted arbitration dispute with Exxon Mobil and CNOOC, Hess's Guyana partners. According to Frederic Boucher, a risk arbitrage analyst at Susquehanna Financial Group, regulatory clearance could be granted next month, which coincides with the Federal Trade Commission's (FTC) recent approval of Exxon's acquisition of Pioneer Natural Resources. The most important remaining hurdle is to resolve the lawsuit launched by Exxon and CNOOC, who claim first refusal on any sale of Hess's Guyana holdings. The purchase required a majority of the 308 million outstanding Hess shares to be approved, and preliminary results indicate support, though Hess has yet to release the vote total. This decision represents a big triumph for CEO John Hess, who has put his reputation and the heritage of his father's company at stake by pursuing this merger. The outcome alleviates demands from some shareholders seeking more compensation for the sale's delay. Exxon's arbitration proceedings could push the deal's closing date into 2025. "We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction and look forward to the successful completion of our merger with Chevron," Hess stated in a statement. Following the decision, Hess stock jumped marginally to $152.05, while Chevron stock rose by less than 1 per cent to $159.04. "Assuming Chevron wins the arbitration against Exxon or reaches a settlement, the transaction will now proceed," said Mark Kelly, an analyst with MKP Advisors. The merger has substantial consequences for both companies. Chevron’s acquisition of the lucrative Guyana oilfields from Hess could help minimise geopolitical concerns linked with the TengizChevroil project in Kazakhstan, which predominantly delivers oil through Russia to the Black Sea. Additionally, this acquisition could counterbalance the cost overruns at Chevron's Australian liquefied natural gas (LNG) projects, which have been plagued by labour and operational concerns. Acquiring Hess' Guyana holdings would increase Chevron's oil and gas reserves while also providing a new growth path beyond its present activities in the United States and Central Asia, according to Morningstar analyst Allen Good. Hess shareholders will control approximately 15 per cent of the larger Chevron corporation and will be eligible to receive its dividend, which is four times more than Hess' present payout. The shareholder vote boosts Hess's negotiating stance with Exxon. While Exxon has expressed no interest in acquiring Hess as a whole, it has not ruled out the prospect of bidding for Hess' Guyana assets. "It's beneficial that Chevron cleared this hurdle amid uncertainty over the Guyana arbitration," said Good. "However, I don't think it will affect the outcome of Exxon's claim." A spokesperson for Chevron stated that the company intends to complete the FTC regulatory procedure in the coming weeks. "We are confident our position on the preemption right will be affirmed in arbitration," the organisation stated. Exxon is the sole producer in Guyana, with 45 per cent ownership in the Stabroek Block and CNOOC holding a 25 per cent interest. Both corporations claim first refusal on any sale of Hess's 30 per cent interest. Institutional Shareholder Services, a proxy consulting firm, had advised shareholders to abstain and encouraged Hess to offer incentives considering the deal's delays. According to sources familiar with the situation, John Hess spent the previous month lobbying significant shareholders for support, personally visiting, or calling more than 30 companies. (With inputs from Reuters)

Hess shareholders approve $53 billion merger with Chevron

Chevron corporation has announced a $53 billion all-stock deal to acquire its smaller rival, Hess corporation. This all-stock transaction marks a pivotal moment, intensifying the rivalry between chevron and Exxon Mobil. The acquisition is designed to bolster Chevron's presence in key areas, namely US Shale and the oil-rich region of Guyana.

Chevron acquires rival Hess Corp for $53 billion

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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Hess shareholders approve $53 billion merger with Chevron

Chevron acquires rival Hess Corp for $53 billion

Chevron to buy competitor Hess Corp for $53 billion