Chevron triumphs over Exxon, wins 20-month battle to buy Hess

Chevron Corp. has prevailed in a 20-month fight to buy Hess Corp. for $53 billion, overcoming a challenge by arch rival Exxon Mobil Corp. that was unprecedented in the modern history of Big Oil.

The ruling by an arbitration court allowing the deal to close is a major victory for Chevron, ending a period of strategic limbo that hurt its stock and prompted questions over the quality of the company’s due diligence when it agreed to buy Hess in October 2023. Chevron Chief Executive Officer Mike Wirth said he would walk away from the deal if they lost the case.

“This creates a premier international and oil and gas company,” Wirth said in an interview with Bloomberg Television.

Chevron shares initially rose as much as 3% in New York, then fell 1.1% in the afternoon. Exxon declined as much as 3.1%.

The clash between North America’s biggest energy producers was rare public feud in the oil sector, an industry in which companies routinely partner with each other to minimize project risk and share costs. Exxon, which operates and owns 45% of Guyana’s offshore Stabroek Block, claimed it had a right of first refusal over the disposition of Hess’s 30% stake.

Hess and Chevron, however, argued the right didn’t apply because their deal was structured as a corporate merger rather than an asset sale.

In an interview Friday, Wirth said the outcome of the deal was never in doubt.

“This was a straightforward plain reading of a contract,” he said. “It is unfortunate that Hess’ employees and Hess’ shareholders were put through this. It should have been resolved much quicker.”

— Bloomberg News