Chevron Proves Patience Is a Virtue

It took a while, but Chevron (NYSE: CVX) has finally found a deal to its liking. This week, the oil giant agreed to acquire Noble Energy (NASDAQ: NBL) for $5 billion in stock. Add in the assumed debt, and the total transaction value is around $13 billion.

That's a much lower price tag than Chevron's last acquisition attempt, when it had an agreement to acquire Anadarko Petroleum for $33 billion in stock and cash. Tack on the assumed debt and the total transaction value would have been $50 billion. In the end, Occidental Petroleum (NYSE: OXY) outbid it by $5 billion in a move that backfired big time.

Instead of using its financial might to push the bidding higher, Chevron walked away from that transaction and waited until it found another target that met its criteria. That patience has paid off, as its pending purchase of Noble Energy looks like an even better deal on paper.

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Source Fool.com