In a recent development that marks another significant consolidation in the U.S. oil industry, Chevron Corp. has announced an agreement to acquire Hess Corp. The deal, which is worth $53 billion, follows Chevron’s standard all-stock transaction pattern.
As part of the acquisition, Chevron is set to pay $171 per share for Hess. Monday’s statement from the companies revealed that Hess shareholders will receive 1.025 shares of Chevron for each Hess share. Post-acquisition, Hess’s total enterprise value, including debt, would amount to $60 billion.
This significant merger is the second of its kind within the U.S. oil industry seen in recent weeks. It closely follows on the heels of Exxon Mobil Corp declaring their intention to acquire shale-oil producer Pioneer Natural Resources Co. The Paramount deal, made for $58 billion, underscores the escalating consolidations within the industry.
As the dynamics of the U.S. oil industry continuously shift, this important merger is expected to further enhance Chevron’s dominant position. Though the repercussions for the global oil industry remain to be seen, these movements may signal a tightening concentration of power within the industry.
The information offered above is curated from a Bloomberg Law report.