Chevron and Renewable Energy Group have 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 renewable fuels production and feedstock capabilities with Chevron’s 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.
“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.”
Source: Chevron
