Shares of Noble Energy Inc. NBL,
increased 8.8% in premarket operations on Monday, after Chevron Corp. CVX,
confirmed an all-stock deal to buy the oil and gas producer for around $ 5 billion. Including Noble’s debt, the deal would be valued at around $ 13 billion. The deal was previously reported by The Wall Street Journal. Chevron shares rose 0.1% below the open. Under the terms of the agreement, Chevron will exchange 0.1191 Chevron shares for each outstanding Noble share. Based on Friday’s closing prices, Noble’s shares would be valued at $ 10.38, or a 7.6% premium. “This is a profitable opportunity for Chevron to acquire additional proven resources and reserves,” said Chevron Chief Executive Michael Wirth. “Noble Energy’s high-quality, multi-asset portfolio will enhance geographic diversity, increase capital flexibility, and enhance our ability to generate solid cash flow.” Year to date, Noble Energy shares have fallen 61.1% through Friday and Chevron shares are down 27.7%, while the DIA Jones Industrial Average DJIA,
it has decreased 6.5%.
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