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Occidental To Buy Anadarko In $57 Bln Deal

Occidental Petroleum Corp. (OXY) agreed to buy Anadarko Petroleum Corp. (APC) in a transaction valued at $57 billion, including the assumption of Anadarko's debt, the companies said.

As per the deal, Occidental would acquire Anadarko for $59.00 in cash and 0.2934 Occidental stock per share of Anadarko. The transaction is expected to close in the second half of 2019.

Meanwhile, Anadarko announced that prior to entering into the merger agreement with Occidental, the company terminated its merger agreement with Chevron Corp. (CVX). As per the terms of the agreement, Anadarko has paid a termination fee of $1 billion to Chevron.

Occidental said it expects to fund the cash portion of the consideration through a combination of cash from its balance sheet and fully committed debt and equity financing, including proceeds from $10 billion equity investment by Berkshire Hathaway.

As previously announced on May 5, 2019, Occidental has entered into a binding agreement to sell Anadarko's Algeria, Ghana, Mozambique and South Africa assets to Total S.A. (TOT) for $8.8 billion. The sale is contingent upon Occidental completing its acquisition of Anadarko, and would be expected to close simultaneously or as soon as reasonably practicable afterwards.

Occidental expects to reduce debt over the next 24 months through free cash flow growth, realizing identified synergies and executing a planned portfolio optimization strategy with $10 billion - $15 billion of divestitures over the next 12-24 months; $8.8 billion of which has already been agreed through the transaction with Total.

Earlier today, Chevron said that it would not increase its offer to buy Anadarko Petroleum Corp.

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