Chevron Enhances Growth Strategies With Unocal Merger
August 10 2005 - 2:51PM
PR Newswire (US)
Acquires High-Quality Operations in Asia-Pacific, the Caspian and
the U.S. Gulf of Mexico SAN RAMON, Calif., Aug. 10
/PRNewswire-FirstCall/ -- Chevron Corporation (NYSE:CVX) today
announced that it has completed its merger with Unocal Corporation
(NYSE:UCL). The combined company is strengthened by complementary
assets, talented employees and synergies. Approximately 77.21
percent of Unocal shares outstanding, and 96.62 percent of those
Unocal shares present and entitled to vote, were voted in favor of
the merger agreement. The merger agreement was originally signed on
April 4, 2005, and amended on July 19, 2005. Under terms of the
agreement, Unocal stockholders had the option to receive for each
Unocal share either $69 in cash, 1.03 shares of Chevron stock or a
combination of $27.60 in cash and 0.618 of a share of Chevron
stock, with the all-cash and all-stock elections subject to
proration. "This merger provides current and long-term investment
value, and Unocal is an excellent strategic fit with Chevron's
assets and corporate culture," said David J. O'Reilly, Chevron's
chairman and chief executive officer. "Chevron has proven technical
and financial capabilities to maximize the full value of Unocal's
world-class assets, and Unocal's talented employees worldwide will
enhance our organizational capability." O'Reilly added, "This is an
important milestone for Chevron, and I want to welcome Unocal
employees to our company. The addition of Unocal strengthens our
position as a global energy leader, and together we will be able to
accomplish great results." The combined company will produce
approximately 2.8 million barrels of oil-equivalent per day,
including production from oil sands, production under operating
service agreements and the company's share of production by equity
affiliates. The merger will increase Chevron's proved reserves
(based on year-end 2004 reporting and including the company's share
of equity affiliates) by more than 15 percent. The merger is
expected to be accretive to earnings per share in 2006. Unocal's
key areas of operations in the Asia-Pacific and Caspian regions,
and the U.S. Gulf of Mexico, make a strong strategic fit with
Chevron's existing core areas of operations. In the Asia-Pacific
region, which is anticipated to be one of the world's strongest
economic growth areas, the combined company will generate more than
20 percent of its equivalent daily crude oil and natural gas
production. The company will also be a leading resource holder in
this region. The strong strategic fit between the two companies
will provide for a rapid and efficient integration, for which
planning is complete. To date, the company has confirmed the
continued employment of more than 5,000 Unocal employees. Chevron
intends to make employment offers to many of the remaining 1,400
Unocal employees and to conclude the selection process by the end
of September. Charles Williamson, Unocal's chairman and chief
executive officer, will join Chevron in a transition role until
later this year. He will be an executive vice president of the
corporation, assisting with the integration of the two companies.
Chevron Corporation is one of the world's leading energy companies.
With more than 53,000 employees, Chevron subsidiaries conduct
business in approximately 180 countries around the world, producing
and transporting crude oil and natural gas, and refining, marketing
and distributing fuels and other energy products. Chevron is based
in San Ramon, Calif. More information on Chevron is available at
http://www.chevron.com/. Cautionary Information Regarding
Forward-Looking Statements Except for the historical and factual
information contained herein, the matters set forth in this news
release, including statements as to regulatory approvals for the
merger, timing expectations to complete the merger integration and
other statements identified by words such as "estimates,"
"expects," "projects," "plans," and similar expressions are
forward-looking statements within the meaning of the "safe harbor"
provisions of the Private Securities Litigation Reform Act of 1995.
These forward-looking statements are subject to risks and
uncertainties that may cause actual results to differ materially,
including the satisfaction of other closing conditions contained in
the merger agreement and other risk factors relating to our
industry as detailed from time to time in each of Chevron's and
Unocal's reports filed with the Securities and Exchange Commission,
including each such company's most recent Annual Report on Form
10-K. You should not place undue reliance on these forward-looking
statements, which speak only as of the date of this press release.
Unless legally required, Chevron undertakes no obligation to update
publicly any forward-looking statements herein, whether as a result
of new information, future events or otherwise. DATASOURCE: Chevron
Corporation CONTACT: Donald Campbell of Chevron Corporation,
+1-925-842-2589 Web site: http://www.chevron.com/
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