Berkshire To Make $10 Billion Investment In Occidental To Finance Anadarko Bid -- Update
April 30 2019 - 9:58AM
Dow Jones News
By Micah Maidenberg
Berkshire Hathaway Inc. has agreed to make a $10 billion equity
investment in Occidental Petroleum Corp., a bid to help the oil
company complete its proposed acquisition of Anadarko Petroleum
Corp.
In return for the investment, Berkshire will receive 100,000
shares of preferred stock, according to a statement from
Occidental. The preferred stock will generated dividends at 8% a
year.
In addition, Bekrshire will receive a warrant to buy up to 80
million shares of Occidental common stock at a price of $62.50 a
share.
Shares of Occidental closed Monday at $60.13.
Berkshire couldn't immediately be reached for comment. Berkshire
will only follow through on the investment if Occidental is able to
enter into and complete its proposed acquisition of Anadarko.
Last week, Houston-based Occidental offered to purchase Anadarko
for $38 billion. The bid topped the $33 billion that Chevron Corp.
agreed to pay to buy the company.
On Monday, Anadarko said it was considering Occidental's offer,
but added its merger agreement with Chevron remained in place.
Chevron's deal entitles it to receive a $1 billion breakup fee if
Anadarko walks away.
"We are thrilled to have Berkshire Hathaway's financial support
of this exciting opportunity," Occidental Chief Executive Officer
Vicki Hollub said in prepared remarks.
Monday, a Chevron spokesman said in a statement the company
believes its agreement offers Anadarko the best value and most
certainty to Anadarko shareholders.
Write to Micah Maidenberg at micah.maidenberg@wsj.com
(END) Dow Jones Newswires
April 30, 2019 09:43 ET (13:43 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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