Occidental Petroleum Corp. on Thursday agreed to acquire smaller rival Vintage Petroleum Inc. for about $3.52 billion to expand in Latin America and California.

The deal allows Occidental, a major producer in Colombia and Ecuador, to build its production base in Latin America by adding Vintage's assets in Argentina to its portfolio. Vintage also has assets in Yemen and California. Under the terms of the deal, Los Angeles-based Occidental will pay $20 in cash plus 0.42 of an Occidental share for each Vintage share. Occidental will also assume $550 million in debt and $225 million in cash on Vintage's balance sheet at the end of the year.

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