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Chevron’s Acquisition of Hess Approved by Shareholders
Hess shareholders approved the company’s acquisition by American oil giant Chevron on Tuesday. According to Reuters, a majority of shareholders gave the transaction a thumbs-up, though a vote tally wasn’t yet available. The $53 billion deal is expected to give Chevron access to a major oil development that could significantly expand its asset base.
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“We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction and look forward to the successful completion of our merger with Chevron,” said John Hess, CEO of Hess, in a statement.
Chevron was optimistic about the deal when it launched the takeover attempt in October. CEO Mike Wirth stated, “This combination positions Chevron to strengthen our long-term performance and further enhance our advantaged portfolio by adding world-class assets.” Hess also expressed confidence, saying, “Our strategic combination creates a company that is stronger in every respect, with the leadership, asset portfolio, and financial resources to lead us through the energy transition and deliver significant shareholder value for years to come.”
However, ExxonMobil, Chevron’s biggest rival, initiated a legal maneuver to cut Hess out of its rights to the Stabroek Block, a valuable oilfield off the coast of Guyana. This, coupled with potential antitrust scrutiny in Washington, caused some investors to hesitate. Proxy advisor ISS recommended that Hess shareholders abstain from voting on the deal and seek a delay while further information is gathered. On the other hand, Bloomberg’s report indicated that Glass Lewis believes the deal is acceptable in its current form.
Overall, the approved acquisition of Hess by Chevron marks a significant development in the oil and gas industry, with potential implications for both companies’ future operations.
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