Hess Corp. shareholders approved Chevron Corp.’s $53 billion takeover despite reservations among several prominent investors about a dispute with Exxon Mobil Corp. over a key asset.
Hess shareholders approved the deal during a meeting Tuesday, the company said in a statement Tuesday. The company’s shares initially fell on the news but then recovered, climbing as much as 1%.
“We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction,” Chief Executive Officer John Hess said.
The affirmation is a major win for Chevron and Chief Executive Officer Mike Wirth, who sought to secure a stake in the biggest oil discovery of the past decade by acquiring Hess and its 30% interest in a Guyanese field. In the final days leading up to the vote, John Hess, the longest-serving major oil boss, personally lobbied shareholders to back the deal.
The transaction still needs to get past the U.S. Federal Trade Commission as well as the ongoing arbitration case brought by Exxon over control of Hess’ interest in the Guyanese field. Exxon has said the proceedings may drag into 2025.
Hess investors including HBK Capital Management Group LP and D.E. Shaw & Co. had publicly announced plans to abstain from the vote, arguing that the takeover premium was insufficient to account for the risk from the arbitration Exxon filed over Guyana in March. Exxon has asserted it has a right-of-first refusal over Hess’s most valuable asset — the stake in an 11 billion-barrel field off the coast of Guyana — which is operated and 45% owned by the Texas oil giant.
For Chevron, the addition of Hess’ assets is aimed at arresting investor concerns about the California driller’s long-term growth prospects.
The vote also is a capstone for John Hess, 70, whose father founded the company almost a century ago. John Hess controls roughly 10% of the company’s common stock and will take a seat on Chevron’s board at the conclusion of the deal.