(Reuters) - Chevron Corp said on Friday it would buy smaller rival Anadarko Petroleum Corp for $33 billion in cash and stock to strengthen its presence in the Permian basin and beef up its LNG business.
The offer of $65 per share represents a 39 percent premium to Anadarko's Thursday close. Anadarko's shares soared 33 percent in light premarket trading, while Chevron shares fell 1.5 percent.
"The combination of Anadarko's premier, high-quality assets with our advantaged portfolio strengthens our leading position in the Permian, builds on our deepwater Gulf of Mexico capabilities and will grow our LNG business," Chevron Chief Executive Officer Michael Wirth said in a statement.
The offer is structured as 75 percent stock and 25 percent cash. Chevron will take on $15 billion of Anadarko's debt.
Chevron also said it plans to divest $15 billion to $20 billion of assets between 2020 and 2022.
The enterprise value of deal is $50 billion.
Credit Suisse Securities (USA) LLC is Chevron's financial adviser, while Paul, Weiss, Rifkind, Wharton & Garrison LLP is its legal adviser.
Evercore and Goldman Sachs are financial advisers to Anadarko, while Wachtell, Lipton, Rosen & Katz and Vinson & Elkins LLP are its legal advisers.
(Reporting by John Benny in Bengaluru; Editing by Sriraj Kalluvila)