Chevron To Buy Anadarko Petroleum In $33 Bln Stock & Cash Deal - Quick Facts

(RTTNews) - Integarted energy company Chevron Corp. (CVX) announced Friday that it would acquire all of the outstanding shares of Anadarko in a stock and cash transaction valued at $33 billion, or $65 per share. The deal, which is structured as 75 percent stock and 25 percent cash, is expected to close in the second half of the year, subject to regulatory approvals and other customary closing conditions.

As per the deal terms, Anadarko shareholders will receive 0.3869 shares of Chevron and $16.25 in cash for each Anadarko share. Upon closing of the deal, Chevron will issue about 200 million shares of stock and pay approximately $8 billion in cash. Chevron will also assume estimated net debt of $15 billion. The total enterprise value of the deal is $50 billion.

Chevron expects acquisition to be accretive to free cash flow and earnings per share one year after closing, at $60 Brent. The company expects the deal to gain run-rate cost synergies of $1 billion before tax and capital spending reductions of $1 billion within a year of closing.

Chevron said it plans to divest $15 billion - $20 billion of assets between 2020 and 2022. The company will use the proceeds to further reduce debt and return additional cash to shareholders. Also, Chevron plans to raise its share repurchase rate from $4 billion to $5 billion per year upon closing the deal.