Ongoing merger talks between Occidental Petroleum (OXY) - Get Occidental Petroleum Corporation Report and Anadarko Petroleum (APC) - Get Anadarko Petroleum Corporation Report were cut short on Friday after Chevron announced it would acquire Anadarko for $33 billion, stopping Occidental in its tracks from potentially raising its offer price.

CNBC reported on Monday that Friday's mega-energy merger announcement between Chevron and Anadarko cut Occidental's ongoing overtures to Anadarko short. The Occidental bid had reached the mid-$70s per share and was being structured as a 40% cash deal, sources told the news agency.

Executives at Occidental were under the impression that talks would extend into the weekend, with an opportunity to increase their bid, people familiar with the situation told CNBC. However, the announcement early Friday morning caught many off guard, including Occidental.

Chevron said it will pay $65 a share to Anadarko shareholders and $16.25 in cash for each Anadarko share, making it a 75% stock, 25% cash offer. The total enterprise value of the transaction is $50 billion.

TheStreet Recommends

According to CNBC, Occidental is pondering whether to take its own offer to Anadarko shareholders in an unsolicited offer. The breakup fee for the Chevron-Anadarko deal was said to be 3% of the deal.

Meantime, analysts at BMO Capital on Monday downgraded Anadarko to market perform from outperform, noting that the valuation of Chevron's buyout "looks fair" and a competing bid is unlikely.

Shares of Anadarko were up 1.5% to $62.70, while shares of Occidental were down 2.3% to $63.82. Shares of Chevron were little changed at $120, up 0.2%.

Anadarko is a holding in Jim Cramer's Action Alerts PLUS member club. Want to be alerted before Jim Cramer buys or sells the stock? Learn more now.