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Noble Energy shareholders likely to approve US$4.2 billion Chevron deal

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Noble Energy Inc shareholders on Friday are expected to approve its sale to Chevron for about US$4.2 billion in stock, cementing the first big energy deal since the coronavirus crushed global fuel demand.

FILE PHOTO: An aerial view shows the newly arrived foundation platform of Leviathan natural gas field, in the Mediterranean Sea, off the coast of Haifa, Israel January 31, 2019. Marc Israel Sellem/Pool via REUTERS/File Photo

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HOUSTON: Noble Energy Inc shareholders on Friday are expected to approve its sale to Chevron for about US$4.2 billion in stock, cementing the first big energy deal since the coronavirus crushed global fuel demand.

The purchase would boost Chevron's U.S. shale oil holdings and add nearly 1 billion cubic feet of natural gas reserves close to growing markets. Noble's Leviathan, one of the worlds biggest offshore gas discoveries of the last decade, began pumping gas from the field late last year.

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Proxy advisers Institutional Shareholder Services (ISS) and Glass Lewis have recommended approval of the deal. Activist investor Elliott Management Corp, which took an undisclosed stake in Noble, has not said how it would vote.

Noble declined to make an executive available for an interview. Chevron and Elliott Management declined to comment.

The all-stock deal values Noble at about US$4.2 billion, or US$8.58 per share, based on Chevron's price on Thursday, excluding about US$8 billion in debt. Weak oil prices and a lack of rivals has the stock down about 11per cent from the day before the deal was announced and off 64per cent this year.

Chevron is "doing it at a good time. They're not stretching the balance sheet, they haven't bet the company on it," said David Katz, president of Matrix Asset Advisors, which holds ChRead More – Source