Chevron Corporation (NYSE:CVX) and Noble Midstream Partners have disclosed their entry into a new deal. Reports say that it is definitive agreements that will see Chevron buy off about 33.925 million common units. Experts have been quick to describe the latest agreement as an all-stock transaction that paves the way for all outstanding unitholders of Noble Midstream to get something substantial. The terms of the agreement entitle every outstanding unitholder to about 0.1393 of Chevron common stock shares, based on a per-share basis. The exchange is between Chevron’s common stocks and the Common Units owned.
The buy-in transaction
The Vice President of Chevron Midstream, Colin Parfitt, is pleased to speak about the buy-in transaction, terming it an unprecedented move that will benefit all the stakeholders in the deal. Parfitt looks at the new change from different perspectives, ranging from governance to the latest move value. He exudes confidence in the future, outlining that the recent change will facilitate easy administration in terms of structure.
The official also focuses on the company’s top positions in the DJ and Permian basins, outlining that they will achieve a lot in capturing real value. The Conflicts Committee of the Board has been engaging in a series of consultations with the financial and legal advisors for quite a while. The committee comprises independent directors who, according to reports, approved the merger unanimously. The Board had the final word, and that was to approve the merger.
Closing the transaction
The transaction might come to a close in the second quarter of 2021, and that is if the major players cooperate on everything. Customary approvals are part and parcel of the deal, and they can’t be overlooked in closing the transaction. Chevron’s subsidiary with the most outstanding Common Units voted in favor of the transaction, boosting the deal significantly.
Latham & Watkins LLP serves its role as Chevron’s legal advisor, whereas Citi steps in to act as a financial advisor. On the other hand, the Conflicts Committee of the Board has Baker Botts L.L.P and Janney Montgomery Scott. The two serve as the legal advisor and acting financial advisor, respectively.