(News Bulletin 247) – Chevron Corporation announced today that it has entered into a definitive agreement with PDC Energy, to acquire all outstanding shares of PDC in an all-stock transaction valued at $6.3 billion. dollars, or $72 per share.
Under the terms of the agreement, PDC shareholders will receive 0.4638 Chevron shares for each PDC share. The total value of the transaction, including debt, is $7.6 billion.
PDC brings significant free cash flow, low breakeven production and development opportunities adjacent to Chevron’s position in the Denver-Julesburg Basin as well as additional land in the Permian Basin.
“This transaction reinforces Chevron’s goal of delivering higher yields and reducing carbon emissions,” said Mike Wirth, Chevron’s president and CEO.
This transaction increases Chevron’s proven reserves by 10% at an acquisition cost of less than $7 per barrel of oil equivalent (BOE).
Chevron expects the transaction to be profitable for all key financial metrics in the first year after closing and add approximately $1 billion in annual free cash flow.
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