Berkshire Hathaway is set to acquire Occidental’s chemical division, OxyChem, in a significant deal valued at $9.7 billion. The announcement was made on Thursday, with both companies expressing optimism about the transaction’s benefits.
Berkshire Hathaway’s Acquisition of OxyChem
The acquisition marks Berkshire Hathaway’s largest investment since its purchase of Alleghany, an insurance company, for $11.6 billion in 2022. The deal is expected to conclude in the fourth quarter of 2025 and will be executed as an all-cash transaction.
Debt Reduction Plans
Occidental aims to allocate $6.5 billion from the sale proceeds to reduce its overall debt, which it hopes will fall below $15 billion. This strategic move is anticipated to strengthen Occidental’s financial position moving forward.
Statements from Leadership
- Vicki Holly, Occidental’s President and CEO, stated that the acquisition enhances the company’s financial strength.
- Holly emphasized OxyChem’s development under Occidental, highlighting its operational excellence and dedicated workforce.
- Greg Abel, Vice Chairman of Berkshire Hathaway, expressed enthusiasm about adding OxyChem to their diverse portfolio.
Abel commended Occidental’s management for its commitment to financial stability. He praised their plans to use the proceeds from the sale to fortify the company’s balance sheet.
As this acquisition progresses, both Berkshire Hathaway and Occidental anticipate significant gains from the deal, reinforcing their positions within the chemical industry.
