Hess shareholders sign off on $53 billion sale to Chevron

HOUSTON — Hess shareholders on Tuesday approved the proposed $53 billion merger with Chevron that paves the way for the No. 2 U.S. oil company to gain a prize asset and a foothold in rival Exxon Mobil’s massive Guyana discoveries.

The approval clears one hurdle, but the deal still requires regulatory approval and must face a lengthy arbitration battle with Exxon and CNOOC, Hess’ partners in Guyana.

Regulatory approval could come next month, said Frederic Boucher, risk arbitrage analyst at Susquehanna Financial Group, based on the time the Federal Trade Commission (FTC) took to approve Exxon’s acquisition of Pioneer Natural Resources earlier this month.

But the most crucial step to approve the deal, he said, is a resolution of the dispute filed by Exxon and CNOOC asserting they have a right of first refusal to any sale of Hess’s Guyana assets.

A majority of Hess’s 308 million shares outstanding voting in favor of the deal was required for approval. Results were preliminary and Hess did not immediately provide the vote tally.

The vote is a win for CEO John Hess, who put his reputation and the future of a company founded by his father on the line.

The result puts to rest claims by some shareholders who wanted additional compensation for the delay in closing the sale. Exxon’s arbitration could push the deal’s closing into 2025.

“We are very pleased that the majority of our stockholders recognize the compelling value of this strategic transaction and look forward to the successful completion of our merger with Chevron,” CEO Hess said.

Hess and Chevron shares gained on the results. Hess rose a fraction to $152.05 and Chevron climbed less than 1% to $159.04.

“Assuming Chevron wins the arbitration from Exxon or finds a settlement, the transaction is now going to happen,” said Mark Kelly, an analyst with financial firm MKP Advisors.