Chevron given approval to buy Texaco; Texaco ordered to divest Equilon, Motiva businesses

WASHINGTON, D.C. (Sept. 10, 2001) — The U.S. Federal Trade Commission unanimously approved Chevron Corp.’s $45 billion US acquisition of Texaco Inc., clearing the way for the companies to become the world’s fourth-largest producer of oil and natural gas.

As expected, the FTC said Texaco must sell holdings in two joint ventures, Equilon Enterprises LLC and Motiva Enterprises LLC.

The commission named a trustee to handle the sale, who will have eight months to unload the assets. Royal Dutch/Shell Group is seen as the likely buyer. It owns 56% of Equilon, a West Coast refining business; Texaco controls the remaining interest. Texaco owns 31% of Motiva, an East Coast refining business; Shell has a 35% stake, with the balance owned by Saudi Refining Co.

With Equilon and Motiva, the merged company would have controlled 33% of West Coast refining capacity and 40% of retail stations.

Chevron and Texaco will hold special shareholder meetings on Oct. 9 in Houston to vote on the deal. The new Chevron Texaco will move its headquarters to San Ramon, Calif., next year.