CVX: Chevron Agrees to Buy Rival Oil Firm Hess in All-Stock Mega Deal Valued at $53 Billion

Six months after negotiations started, the big merger got through at $171 a share – just 4.9% premium over the closing price.

• Oil giant Chevron CVX and smaller rival Hess HES are proceeding to a mega merger after six months of negotiations. The two companies agreed on an all-stock deal valued at $53bn. The price tag means a fairly tiny premium of 4.9% over the closing price and a per-share valuation of $171.
• The deal is the latest example of consolidation in the energy sector. Chevron said this acquisition will help boost shareholder returns and add to better portfolio diversification. The Big Oil firm will take on an additional $7bn of debt, paying a total of $60bn for the transaction.
• Hess shares tumbled 1% on Monday, and Chevron stock drifted lower by 3.7% on the day. This year hasn’t been particularly lucrative for oil-stock investors. Chevron has slipped nearly 8% year-to-date, valuing the company at just over $306bn. Hess shares, however, have gained 20% on the year.