CHEVRON DEAL DIES; TEXACO SPURNS PROPOSAL FOR MERGER.Byline: Agis Agis (ā`jĭs), name of four Spartan kings. Agis I, fl. late 10th cent. B.C., was the traditional founder of the Agiad dynasty, one of the two ruling dynasties of Sparta, which had a dual kingship. Salpukas The New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times Texaco Inc. said Wednesday that its board had rejected a merger proposal from Chevron Corp. and ended all takeover talks. People close to the talks said Chevron had offered to buy Texaco for $70 a share, or about $37.5 billion, far below the $80 a share that Texaco had sought and analysts believed would have been a fair price. Chevron also had demanded that a Chevron executive head the new company, while Peter I. Bijur, the 57-year-old chairman and chief executive of Texaco, had wanted the combined board to decide who would head the merged company, people close to the talks said. Further, the people said, Chevron wanted Texaco to sell its interests in the refining refining, any of various processes for separating impurities from crude or semifinished materials. It includes the finer processes of metallurgy, the fractional distillation of petroleum into its commercial products, and the purifying of cane, beet, and maple sugar and marketing alliances it had formed with Shell Oil Co., the U.S. subsidiary of Royal Dutch/Shell Group and Saudi Refining Saudi Refining, Inc., (SRI) with headquarters in Houston, purchases and sells crude oil and maintains a significant inventory of crude oil outside the United States. SRI has an interest in a limited liability company known as Motiva Enterprises, LLC. Inc., which is a unit of Saudi Aramco Saudi Aramco, the state-owned national oil company of Saudi Arabia, is the largest oil corporation in the world and the world's largest in terms of proven crude oil reserves and production. . The people close to the negotiations said the sale would have been complicated and would have delayed the completion of a deal. ``It was a low-ball, cheap proposal,'' one of the people close to the talks said of Chevron's offer. The people said Bijur had initiated the discussions with Chevron last summer when crude oil prices plunged to about $14 a barrel. Since then, crude oil prices have recovered and are in the $16- to $17-a-barrel range. In a statement issued after the stock market closed Wednesday, Texaco said its board ``found no compelling basis for the discussions to continue and Chevron's proposal to be unacceptable for reasons including complexity, feasibility, risk and price.'' The statement added that ``Texaco intends to move forward aggressively to execute its business plan.'' Shares of Texaco rose 31.25 cents, to $64.50, in trading on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. , while Chevron jumped $1.5625, to $92. Chevron, which is based in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden , confirmed that it had ended its talks with Texaco. Kenneth T. Derr Kenneth T. Derr is a member of the board of directors of the Halliburton Company. He is a Retired Chairman of the Board, Chevron Corporation (international oil company). He served as Chairman and Chief Executive Officer, Chevron Corporation, 1989-1999. , Chevron's chairman and chief executive, said, ``I'm surprised that the Texaco board turned down a very competitive offer that included a significant price premium to Texaco shareholders and an opportunity to receive Chevron stock, with its acknowledged strong growth prospects.'' Analysts and investors had doubted that the two companies would complete the merger. One of the reasons was that Derr, who is 62, was not willing to share power with Bijur. Chevron wanted to follow the pattern of other mergers and emerge as the dominant company after absorbing Texaco. This had occurred when British Petroleum began the oil merger wave when it took over Amoco Corp. last August for $42.8 billion. This was followed by an agreement by Exxon Corp. to take over Mobil Corp. for $87 billion in December. British Petroleum had reached an agreement to buy Arco in March for $26.8 billion. |
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