October 5, 2020
Leviathan platform in Israel – Credit: Noble Energy
U.S. oil major Chevron has completed the acquisition of its smaller rival Noble Energy, following the approval by Noble Energy shareholders.
The proposed all-stock acquisition was initially announced in July, in what was at the time estimated to be a deal valued a $5 billion.
However, Reuters on Friday reported that the deal’s value dropped to $4.1 billion, as shares of both companies have traded down alongside oil since the initial announcement. Noble shareholders will receive 0.1191 shares of Chevron for each Noble share.
Following the completion of the acquisition on Monday, Chevron Chairman and CEO Michael Wirth said: “We are pleased to welcome Noble Energy’s employees and shareholders to Chevron. Noble’s high-quality assets complement Chevron’s advantaged upstream portfolio, and the combination is expected to deliver strong financial benefits.
“With an industry-leading balance sheet and a track record of capital discipline, we believe we’re in a different place than others and can protect the dividend while driving long-term value.”
Announcing the proposed acquisition back in July, Chevron said Noble Energy brought low-capital, cash-generating offshore assets in Israel, strengthening Chevron’s position in the Eastern Mediterranean. Noble started production from the giant Leviathan gas field off Israel in December 2019.
Chevron said in July Noble also bolstered Chevron’s U.S. unconventional position with de-risked acreage in the DJ Basin and 92,000 largely contiguous and adjacent acres in the Permian Basin.
Reuters on Friday reported, citing Rystad Energy data, that the acquisition of Noble would boost Chevron’s U.S. shale oil holdings and make it the second-largest producer behind EOG Resources.
Apart from Israel and U.S. shale, Noble Energy has oil and gas assets in Equatorial Guinea and Cameroon.