Chevron To Buy Renewable Energy Group For $3.15 Bln In Cash

(RTTNews) - Chevron Corporation (CVX) on Monday announced its decision to acquire Renewable Energy Group, Inc. (REGI) in a deal valued at $3.15 billion, to be paid in cash.

The transaction value of $61.50 per share represents a premium of about 57% on a 30-day average based on closing stock prices on February 25, 2022.

Chevron said the acquisition integrates REG's growing renewable fuels production and feedstock capabilities with Chevron's manufacturing, distribution and commercial marketing position.

The transaction, which is expected to add to Chevron earnings in the first year after closing, and to free cash flow after start-up of REG's Geismar expansion, is estimated to be closed in the second half of 2022.

"Together, we can grow more quickly and efficiently than either could on its own," said Chevron Chairman and CEO Mike Wirth.

Additionally, Cynthia Warner, REG CEO, is expected to join Chevron Board of Directors.

REGI shares are up more than 32% in pre-market at $58.09. On Friday, the stock closed at $43.8, up $0.75 or 1.74%.