Texas hold 'em

24 Apr 2019 By John Foley Follow @johnsfoley

Its $38 bln cash-and-stock offer trumps bigger rival Chevron’s bid for the U.S. oil producer, is a two-thirds premium and in theory helps both sides. Yet Occidental’s shares are less attractive and its debt would jump. Chevron only need sweeten its offer a bit to regain its edge.

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Occidental Petroleum on April 24 proposed to buy oil producer Anadarko Petroleum for $38 billion in cash and stock, beating a $33 billion offer made by U.S. rival Chevron on April 12.

Anadarko investors would receive $38 per share and 0.6 Occidental shares, giving them 29 percent of the combined group. The Chevron offer would leave Anadarko with a stake of 9 percent.

Occidental gets around 58 percent of its production from the Permian region in the southwest United States. The enlarged company would get 38 percent from the region, the bidder said.

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