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Wednesday, Feb 8, 2023

Update: Chevron Completes Unocal Buy

Chevron Corp. completed its $17 billion acquisition of El Segundo-based Unocal Corp. on Wednesday, creating the fourth-largest publicly traded oil company.

The deal puts to rest an unprecedented competition with Cnooc Ltd., the Chinese government-controlled oil company whose higher offer for Unocal spurred heated political debate. Cnooc dropped out of the contest last week.

At a special meeting on Wednesday, Unocal shareholders approved the transaction with 210 million shares representing 77.2 percent of the company’s outstanding stock voted in favor.

Under the terms of the merger, Unocal stockholders were allowed to choose a preference for all cash, all stock or a combination of cash and stock as payment $69 in cash, 1.03 Chevron shares or a combination of $27.60 in cash and 0.618 Chevron shares for each Unocal share held.

An overwhelming majority of Unocal shareholders opted to receive all cash. Due to prescribed ratios on the deal, investors who sought the cash payout will receive $30.13 in cash and 0.58 of a share of Chevron common stock. The other ratios were preserved.

Last week, state-controlled CNOOC Ltd. dropped its unsolicited $18.5 billion all-cash offer for Unocal in the face of heavy political opposition. Chevron launched its cash-and-stock bid for Unocal in April.

Unocal shares closed up 0.8 percent to $66.10 on Wednesday.

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