China’s state-run oil firm CNOOC said today it is confident its $18.5 billion cash offer for US producer Unocal will prevail in the takeover battle with Chevron Corporation.
If CNOOC succeeds, it would be the biggest-ever overseas acquisition by a Chinese firm, reflecting China's broader energy strategy of buying overseas oil and gas reserves to feed its fast-growing economy for years into the future.
CNOOC Chairman Fu Chengyu told reporters in an interview he expected to win the takeover battle while maintaining an investment grade credit rating, despite concerns a deal would load it down with debt.
Mr Fu said CNOOC's bid was "clearly superior" to Chevron's cash and stock offer to buy Unocal for roughly $16.4 billion.
"Cash is cash. One hundred percent cash offers complete value certainty to Unocal shareholders, as opposed to Chevron's cash/stock offer," Mr Fu said.
"We are quite confident. We believe the U.S. government will approve the deal."
Unocal, sought for its prized Asian assets, said it would study CNOOC's offer, but that its board continued to recommend a deal with its larger California rival Chevron.
Chevron continued to stand behind its April offer and said its deal was likely to close since it is nearing completion of the regulatory process to allow a vote by Unocal shareholders in early August.