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Postedon March 1, 2022 by &

Chevron to Buy Renewable Energy Group for $3.15 Billion

Chevron to Buy Renewable Energy Group for $3.15 Billion
Chevron Corporation and Renewable Energy Group (REG) Inc announced a definitive agreement under which Chevron will acquire the outstanding shares of REG in an all-cash transaction valued at $3.15 billion, or $61.50 per share. The acquisition combines REG's growing renewable fuels production and leading feedstock capabilities with Chevron's large manufacturing, distribution and commercial marketing position.
"REG was a founder of the renewable fuels industry and has been a leading innovator ever since,"said Chevron Chairman and CEO Mike Wirth."Together, we can grow more quickly and efficiently than either could on its own."
The transaction is expected to accelerate progress toward Chevron's goal to grow renewable fuels production capacity to 100,000 barrels per day by 2030 and brings additional feedstock supplies and pre-treatment facilities. After closing of the acquisition, Chevron's renewable fuels business, Renewable Fuels - REG, will be headquartered in Ames, Iowa. In addition, CJ Warner is expected to join Chevron's Board of Directors. For further information see the亚博体育report onSustainable Alternative Fuels 2021-2031.
"This transaction delivers premium cash value to shareholders and will give us additional resources as we aim to accelerate growth and strengthen our collective ability to deliver the sustainable fuels our customers and the world need,"said CJ Warner, REG president & CEO."Our employees' hard work and dedication have built a fantastic renewable fuels company and made this transaction possible. We look forward to joining Chevron's team."
The transaction is expected to be accretive to Chevron earnings in the first year after closing and accretive to free cash flow after start-up of REG's Geismar expansion. The acquisition consideration is 100 percent cash.Totalenterprise value of $2.75 billion includes a net cash position around $400 million greater than debt. The transaction has been approved by the Boards of Directors of both companies and is expected to close in the second half of 2022. The acquisition is subject to REG shareholder approval. It is also subject to regulatory approvals and other customary closing conditions.
Source: Chevron Corporation
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