Any predictions on what the Chevron premium on the stock price will be?
6 replies (most recent on top)
Oxy, I mean tOxy. Chevron will pick off assets at a discount, further decreasing our value.
If Anadarko was worth $55 billion isn’t OXY and Anadarko together worth $55 billion? Eventually prices will recover. OXY market cap is $15 billion, debt at 40 billion...
OP
No one is going after all of Oxy anytime soon. Way too much debt to assume.
Chevron and others would gladly pay fire sale prices for adjacent Permian assets that Oxy will have to sell to pay off debt. $6B due in 2021, not including the $800MM they owe Buffett each year. Existing shareholders are not going to continue taking haircuts like they did in 1Q when Buffett got his $200MM paid in discounted shares.
VH and her EC already messed up by not selling enough of the non-core APC assets early enough and even then not accounting for capital gains taxes on Mozambique LNG sale. How is that band of idjits still in charge?
No white knight for Oxy.
Icahn wants a profit and only way is to sell off assets and run away. Employees will get the short end of it, as always. Chazen is not much help. After all, he’s the one who picked VH.
Buffett still owns $10B in preferred shares. Only way to pay him off is to let him grab OxyChem? Otherwise, they have to fork over $800MM in interest each year.
Whether oil prices come back up slowly or quickly, Oxy will have to file Chapter 11 to protect itself from creditors. Creditors will get equity in exchange for giving up on or restructuring debt, making existing Oxy shareholders even less happy.
Only bad options going forward.
I’m ex-employee of Oxy (12+ years) who was able to retire in September 2019 (in the nick of time!) but also a current shareholder.
I did good work and was treated well by Oxy but decisions made by VH /EC from 2017 onward were incoherent, incompetent, inane, ...
WTI was severely negative for one day. Oxy's oil is sold on the futures market and were selling the June contract when the May contract went negative. No, it was not good for the price to go negative, but I doubt Oxy paid anyone to take the oil.
Chevron will not acquire Oxy. Why would they buy a company that has a market cap of less than 15B with over 40B in debt? From what I gather, Oxy has ~100B in assets, but that is at much higher valuations.
Chevron hasn’t cut anyone’s pay, and can borrow money for less than 2%. And I saw in the news that somehow they managed to get a good price like $1.6 billion for selling their Azerbaijan position. They have their st together. What would they want any pice of this stshow, at any price????
Just like WTI trading below zero (i.e. you had go pay someone to take delivery of oil), I think the only way Chevron buys us is if we PAY them to do so. Who would want to bring this mess into a well run company? And invite in Uncle Carl as a shareholder, Uncle Warren and his preferred at 8%, and now if VH gets her way Uncle Sam as both a bondholder AND a shareholder.