Renewable Energy Group Shares Soar 39% after agreeing on a deal with Chevron to acquire the firm in a $3.15B, according to a press release by Chevron on Monday.
- The acquisition integrates REG’s growing renewable fuels production and leading feedstock capabilities with Chevron’s large manufacturing, distribution, and commercial marketing position.
- Mike Wirth, Chevron Chairman and CEO, stated that REG was a founder of the renewable fuels industry and has been a leading innovator over the years.
- The deal is anticipated to boost progress toward Chevron’s goals to expand renewable fuels production capacity to 100,000 barrels per day by 2020 and provide extra feedstock supplies and pre-treatment facilities.
- Upon finalization of the acquisition deal, Chevron’s renewable fuels business, Renewable Fuels-REG, will be based in Ames, Iowa. CJ Warner is also expected to join Chevron’s board of directors.
The transaction will contribute to a gradual increase in Chevron earnings in the first year after finalization and add to free cash flow after the start-up of REG’s Geismar expansion. REGI up +38.18%, Pre-market trading
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