By Sabrina Valle
(Reuters) – U.S. oil producer Chevron’s acquisition of Hess set to be approved by FTC, clearing final hurdle for $53 billion deal.
The U.S. Federal Trade Commission is expected to greenlight U.S. oil producer Chevron’s purchase of Hess as soon as this week, two people familiar with the matter said, leaving Exxon Mobil’s challenge to the $53 billion deal as its final hurdle.
The proposed merger was first announced last October, and the FTC sent a second information request to Chevron two months later. Uncertainty over the deal’s closing has knocked Chevron shares down 1% this year compared to a 6.5% increase in energy share fund XLE.
Exxon and CNOOC Ltd, Hess’s partners in a Guyana joint venture, are challenging the deal by claiming a right of first refusal to any sale of Hess’s Guyana assets, the prize in the proposed merger.
Analysis: The U.S. Federal Trade Commission is set to approve Chevron’s acquisition of Hess, a major development in the $53 billion deal. This approval is a significant milestone for Chevron and could impact the energy sector as a whole. The uncertainty surrounding the deal has affected Chevron’s stock performance, making it an important event for investors to monitor. Exxon Mobil and CNOOC Ltd’s challenge adds another layer of complexity to the situation, potentially impacting the final outcome of the merger. Overall, this approval could have far-reaching implications for the companies involved and the energy market in general.