Chevron To Acquire Noble Energy In All-stock Deal Valued At $5 Bln - Quick Facts

(RTTNews) - Chevron Corp. (CVX) announced Monday that it has entered into a definitive agreement with Noble Energy, Inc. (NBL) to acquire all of the outstanding shares of Noble Energy in an all-stock transaction valued at $5 billion, or $10.38 per share, adding low-cost, high quality, proved reserves to Chevron's global upstream portfolio. The proved reserves will be acquired for under $5 per oil equivalent barrel.

Based on Chevron's closing price on July 17 and under the terms of the agreement, Noble Energy shareholders will receive 0.1191 shares of Chevron for each Noble Energy share. The total enterprise value, including debt, of the transaction is $13 billion.

Noble Energy's multi-asset, high-quality portfolio will enhance geographic diversity, increase capital flexibility, and improve Chevron's ability to generate strong cash flow.

The transaction is expected to achieve run-rate operating and other cost synergies of $300 million before-tax within a year of closing. Chevron also anticipates the transaction to be accretive to ROCE, free cash flow and earnings per share one year after closing, at $40 Brent.

In aggregate, upon closing of the transaction, Chevron will issue approximately 58 million shares of stock. Following closing of the transaction, Noble Energy shareholders will own approximately 3% of the combined company.

The transaction, unanimously approved by the Boards of Directors of both companies, is expected to close in the fourth quarter of 2020. The acquisition is subject to Noble Energy shareholder approval, regulatory approvals and other customary closing conditions.