HOUSTON - Occidental Petroleum snatched up some of the richest shale oilfields in Texas when it beat out rival Chevron Corp in a bidding war to acquire Anadarko Petroleum.
Shedding debt will require selling assets when deals have been sluggish, said bankers and merger specialists. The number of U.S. deals has fallen to lows not seen in five years or more as investor demands for capital discipline have driven buyers from the market, said Todd Dittmann, managing director at investment firm Angelo Gordon.
Occidental declined to comment, but CEO Hollub told shareholders and analysts she expects to squeeze $3.5 billion per year in cost savings and capital spending cuts from the deal, and is eager to apply the company’s Permian Basin expertise to Anadarko’s Texas and Colorado oil fields.Several major oil companies would be willing to buy the Gulf of Mexico offshore assets, or any Permian acreage if Occidental decided to sell some of its long-held properties. It controls about 2.
Another likely candidate for a sale is Western Midstream Partners, Anadarko’s majority-owned gas gathering and pipeline business, valued at around $7.5 billion. Occidental has previously sold off pipelines and coastal terminals. The company’s view of pipeline assets, said finance chief Cedric Burgher to analysts, is “you don’t need to own” them, only to have the right to use them.
United States United States Latest News, United States United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: Forbes - 🏆 394. / 53 Read more »