Chevron is acquiring Anadarko Petroleum for $33bn

The deal is considered the biggest takeover in the oil and gas industry since Shell’s purchase of BG Group in 2015

Chevron on Friday announced plans to acquire oil and gas exploration and production company Anadarko Petroleum in a cash and stock deal valued at $33bn. The transaction will give the second biggest US energy company a boost in shale oil production as well as African liquefied natural gas, putting it in the top ranks of the world’s largest energy companies.

Following the news, shares of Anadarko rose nearly 30% in the premarket trading to $60.95 a share. Chevron shares were down 4.2% from Thursday’s close of $125.99 a share.

“This takes a great company and makes it even better,” Chevron’s Chairman and CEO Michael Wirth told CNBC after the news broke. “As our company has strengthened its financial situation over recent years, we’re always looking to make our portfolio even stronger.”

The $33bn blockbuster acquisition - $50bn including debt - ranks as the sixth-largest oil and gas deal on the books, according to Drillinginfo and Dealogic. The deal is also the biggest takeover in the oil and gas industry since in 2015 Royal Dutch Shell bought British energy giant BG Group for $82bn in enterprise value.

More importantly, however, the takeover puts Chevron neck and neck with the oil and gas production of Exxon Mobil Corp. and Royal Dutch Shell, both of which have dominated Big Oil over the last decade.

“Chevron now joins the ranks of the ultramajors,” Roy Martin, an analyst at Wood Mackenzie Ltd., said in a note.

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