Debt is the issue - possible takeover by Chevron
Occidental Petroleum filed an 8K filing in which the company changes its control severance plan for executives.
This action has fueled speculation about a possible takeover down the road.
Which company could be solid enough to attempt a takeover and digest such a large debt load? Maybe Chevron will eventually make an offer, but at what price.
The stock collapsed since January and if we compare OXY with EOG Resources (NYSE:EOG) or Chevron corp. (NYSE:CVX) it is not a bright picture.
Occidental may be forced to redeem some notes in October for about $992 million.
The real issue coming is that the company has about $11.1 billion of notes maturing between 2021 and 2022 (please see the graph below).
With total cash at $2.02 billion at the end of March, the company needs to address the financing seriously and raise some money immediately or cut spending.
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