Hess shareholders approve merger with Chevron
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The news: Hess Corporation shareholders have approved the company’s USD53 billion ($80 billion) merger with the second largest US oil company, Chevron, during a special meeting of stockholders.
The numbers: The merger required a majority vote to approve the deal by a majority of Hess' 308 million shares outstanding to pass. The company did not immediately provide the vote tally.
The context: Energy giant Chevron first offered to buy Hess in October last year, in efforts to gain access to the lucrative Stabroek Block project in Guyana. Hess currently owns 30% of the project.
The Chevron-Hess deal has evolved into a battle between the US’ two biggest oil companies after Exxon filed an arbitration claim arguing it had a right of first refusal to purchase Hess’s interest in the Guyana project, which would boost its own shareholding beyond its current 45% holding. Earlier this week, Guyana’s President, Irfaan Ali, has said he would support Chevron’s proposal to join the ExxonMobil consortium running the country’s USD150 billion offshore oil project.
"Assuming Chevron wins the arbitration from Exxon or finds a settlement, the transaction is now going to happen," Mark Kelly, an analyst with financial firm MKP Advisors told Reuters.
Hess is also facing three lawsuits tied to disclosures around its proposed sale to Chevron.
What they said: Hess CEO John Hess said: “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. Together we will be positioned as a premier integrated energy company, with the leadership, asset portfolio and financial resources to deliver significant shareholder value for years to come.”
The sources: Hess press release, Reuters
