Potential Setback for Chevron
Chevron’s ambitious plan to acquire Hess for a staggering $53 billion in stock might hit a roadblock.
Clash Over Guyana Oil Fields
The core issue revolves around Hess’s valuable share in the vast oil fields near Guyana, a key asset that attracted Chevron to the deal. However, Hess’s partners, Exxon and Cnooc from China, are asserting their preemptive rights to buy out Hess in case of a potential sell-off.
Negotiation in Progress
In a recent filing, Chevron disclosed ongoing discussions with Exxon and expressed confidence in resolving the matter. Nevertheless, there remains a possibility of delays or even the collapse of the deal.
Implications for Chevron
For Chevron, this development could pose a setback as it looks to gain momentum after lagging behind competitors. The acquisition of Hess, with a substantial 30% stake in the offshore project in South America, was intended to be a significant boost. This would mark Chevron’s largest acquisition in recent years.
Market Response
On the market front, Chevron shares saw a slight dip of 0.6% to $153.49 in premarket trading, while Exxon witnessed a 0.2% decline. Hess stock also retreated by 2.7%. Meanwhile, S&P 500 index futures remained relatively stable amidst the uncertainty surrounding the deal.
For more insights and updates, stay tuned for further developments.
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