Unocal board backs Chevron takeover bid

Houston Chronicle ^ | July 20, 2005 | AP

[Cincinatus' Wife]

LOS ANGELES — Unocal's board of directors Tuesday recommended that its shareholders accept a last-minute, $17 billion takeover bid from Chevron, rejecting a competing offer from China's third-largest oil company.

Chevron boosted its offer by $2 per share shortly before the Unocal board met Tuesday night, raising its bid to $63 per share or more than $17 billion.

"Our increased offer has been driven by competitive circumstances, but even at this higher price it remains a compelling transaction for Chevron stockholders," Chevron Chairman and Chief Executive Officer David J. OReilly said in a statement late Tuesday.

Hours later, Unocal's board of directors recommended the company's stockholders vote in favor of adopting the amended merger at their Aug. 10 meeting.

The move appeared to be a blow to CNOOC, an affiliate of China National Offshore Oil Corp. CNOOC, which is 70 percent owned by the Chinese government, had offered $67 per share for Unocal last month after Unocal already agreed to be acquired by Chevron.

American politicians have warned that CNOOC's effort could pose risks to U.S. national security and called for a full review by the Bush administration. The Chinese company's officials have welcomed a security review and denied that CNOOC was acting on behalf of China's government, which is in the midst of a multibillion-dollar campaign to secure foreign oil and gas supplies to power its booming economy.

[Howlin]

Am I up too late again, friend?

[Prime Choice]

American politicians have warned that CNOOC's effort could pose risks to U.S. national security...

Damn straight. The Chinese don't even sneeze without first calculating how it will contribute to the downfall of the United States.

[IslandJeff]

When is the Unocal shareholders' meeting? Can CNOOC counteroffer? We all know they were licking their chops.

[Cincinatus' Wife]

LOL

I'm up a tad early.

[backslacker]

The Chinese company's officials have welcomed a security review and denied that CNOOC was acting on behalf of China's government...
In a previous paragraph: ...CNOOC, which is 70 percent owned by the Chinese government...

The Chinese Gov't must think Americans are stupid.

[carl in alaska]

If I recall correctly, the Unocal sharedholders' meeting is on 8/10/05. Both CNOOC and Chevron could raise their bids before this meeting, but I think the uncertainties generated by a lengthy regulatory review of CNOOC's bid are now a bigger issue than money. The regulatory review of CNOOC's bid could drag on into next year and Unocal's shareholders don't want to wait that long to lock in their gains. There's also some chance that a CNOOC bid could be blocked or materially altered by congress or regulators, and Unocal's shareholders don't want to deal with that either. I predict Unocal's shareholders will vote to accept the Chevron offer on August 10. I'm holding my Chevron shares for further gains this year.

Actually I thougth there was some chance that Unocal's board would recommend the CNOOC offer and I'm interested in what the board's reasoning is for rejecting the CNOOC bid.

[NathanBookman]

So sorry.

[steveegg]

BWAHAHAHAHAHA!!!! (though there are 3 weeks to the ChiComs to put the thumb screws to everybody, which is all they have left).

[Happy2BMe]

Unocol won't turn RED anytime soon - ping.

[fhlh]

Thank you, Chevron!