Latest US$17.1b bid still short of CNOOC's but politics driven by conservative fears swings the balance in favour of US firm
Chevron yesterday increased its takeover bid for Unocal by 5 per cent, raising the stakes in the battle for control of the ninth-largest oil company in the US.
Under pressure to match an US$18.50 all-cash offer for Unocal from rival CNOOC, Chevron revised its bid to include more cash and less stock, raising its value to US$17.1 billion, or US$63 per share based on Tuesday's stock price.
It had originally offered US$16.4 billion, or US$60.51 a share. 'Our increased offer has been driven by competitive circumstances,' Chevron chief executive David O'Reilly said in a statement.
Unocal's board has already approved Chevron's new offer. The two companies issued a joint statement yesterday in which Unocal reiterated its recommendation that Unocal stockholders 'vote in favour of adopting the Chevron merger agreement, as amended, at the special meeting of stockholders scheduled for August 10'.
Nonetheless, a Unocal spokesperson confirmed 'the board continues to evaluate the CNOOC bid'.
Whether CNOOC issues a counter-bid is unclear. Chief executive Fu Chengyu last week received permission from the company's board of directors to raise the company's bid from US$67 to US$69 per share, according to sources familiar with the situation.