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Chevron Scoops Up Noble as Pandemic Pummels Energy Patch

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Energy giant Chevron (CVX) - Get Report is buying Noble Energy (NBL) - Get Report for $5 billion in stock amid one of the most difficult routs in the oil patch in decades.

Chevron announced on Monday that it will buy Noble at for $10.38 a share, or 0.1191 a Chevron share. At that level, the deal represents a roughly 7.6% premium over Noble’s Friday closing price of $9.65 and nearly 12% based on a 10-day average.

Buying Houston-based Noble, which has both U.S. and international operations, compliments Chevron’s presence in the oil-rich deposits of the DJ Basin of Colorado and Permian Basin, which spans West Texas and New Mexico.

It also gives Chevron, which has a market value of $163 billion, assets in the eastern Mediterranean and West Africa. 

Chevron’s stock has surged more than 70% from its March 23 low, despite an unprecedented drop in oil prices sparked in part by the coronavirus pandemic and shutdown of economic activity globally, though augmented by a price war between Russia and Saudi Arabia that fueled one of the biggest supply guts in history.

Meanwhile, more than 20 North American oil producers have filed for bankruptcy this year, the Journal said, citing law firm Haynes & Boone LLP, with California Resources (CRC) - Get Report the latest to file for protection from creditors on Friday.

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