TxAg20 said:

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I haven't been laid off from a major, so I'm not speaking from personal experience.

I work with a former APC employee and he said 2016 severance packages were 2 years plus vesting of all stock.

I have a relative that worked for Clayton Williams Energy when Noble bought them out. He had notified the company he was ready to retire. They talked him into staying on an extra 6 months through the Noble transaction and he was paid 2 years severance.

PXD is currently reducing head count and I haven't heard exact details on their severance, but I've heard the cutoff is age 62 and older in Midland and 55 and older in Las Colinas. Some Midland folks are hoping they expand the age since it's such an attractive package.

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Heard some about the PXD package...18 months pay, prorated bonus, immediate vesting, and some sort of benefits package to help cover healthcare. And this wasn't the result of a merger, so I wouldn't be the least bit surprised for the APC packages to be better for some people. Probably very dependent on time served though.

94chem said:

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Quote:

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There is plenty of dead weight at Chevron

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Is this ever not true? Didn't they just purge everybody 2 years ago?

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At some point they still need bodies to do work, even if they're not good workers, so they definitely didn't purge everybody.

It does not make sense to keep the MCBU folks in the downtown office and the APC Permian folks in the Woodlands office. The Permian is high value for Chevron, don't think the leadership team will go with moving the team away from Houston support.

For what it's worth, when XOM bought XTO, they deemed it not a change of control. Lol. So no vesting. Rumor was XOM insisted on that since everyone would vest and they'd lose all the talent. So, bottom line don't expect any vesting/severance.

joerobert_pete06 said:

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It does not make sense to keep the MCBU folks in the downtown office and the APC Permian folks in the Woodlands office. The Permian is high value for Chevron, don't think the leadership team will go with moving the team away from Houston support.

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Sorry, don't understand what you're saying here.

You're right, doesn't make sense to have split teams. I believe they'll bring whatever Woodlands APC Permian folks that stick around downtown or ask some to move to MID. Who knows... way too many variables at this stage.

When Texaco ceased to exist, Chevron paid tribute by adding a little slash to the logo. Wonder what tribute Anadarko will get for being devoured?

How did they get away with that?

PoopKing said:

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How did they get away with that?

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From what I understand, it was in black and white that it constituted a change of control event. Instead they instituted a lame retention bonus program. But what recourse do you have, sue XOM?

Drillbit4 said:

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PoopKing said:

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How did they get away with that?

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From what I understand, it was in black and white that it constituted a change of control event. Instead they instituted a lame retention bonus program. But what recourse do you have, sue XOM?

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It's the company that's being bought that usually gets fully vested? Are most employees of large companies not fully vested? I remember that Enron employees weren't vested until age 50. Is that really normal these days? I thought Chevron employees were pretty much fully vested as soon as the stocks went into their accounts. Most employees just hang onto insane amounts of company stock for a variety of strange reasons, cause, you know, nothing bad could ever happen to THEIR company.

Cyp0111 said:

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Unvested options or RSUs as part of long term incentive/retention plans. You may get xxx every year which vests pro rata over a 3 year period.

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Oh, I have no clue what you're talking about. I thought vesting was referring to the company stock that is put into a 401(k). At Enron they couldn't sell it and diversify until age 50.

It's funny sometimes how management thinks the average employee understands the first thing about this stuff. I know I have this pension balance I can check, but darned if I know where it came from or how to calculate it. I've just been watching it get bigger for 20 years. It isn't like I have any control over it.

I used to work for PXD and they had a pretty standard comp arrangement There were two vesting schedules that were important. First, the company contributions to your 401k vested over the course of four years, after which you could keep it all permanently. If you left after just a year you would keep 25% of their contribution, etc.

The other, more lucrative vesting is the annual LTIP (Long Term Incentive Program). Each year you would be granted a certain number of shares of stock that would vest over the course of 3 years. So after you and been employed 3 years you'd be getting a "full share" every year. The key from the company's perspective is that there's always a carrot dangling out a couple years ahead of you, disincentivizing employees from leaving. Generally the number of shares/value of the LTIP grows as employees get promoted so there's always a bigger reward down the road if you stay with the company.

If all those LTIPs become fully vested immediately upon consummation of a sale, it's a nice payday and suddenly you don't feel like you're leaving money on the table if you decide to leave the company. This is why Exxon finagled their way into preventing that with XTO (apparently)

I haven't seen Anadarko's comp plan details since shortly after they acquired Kerr-McGee. However, I anticipate they have a double-trigger in their change-in-control provisions. This will likely mean the CIC has to be triggered and you have to be terminated (not for cause) within 12 months for accelerated vesting to occur. I do think the CIC will trigger.

For employees that get to hang around, RSUs will likely just map to Chevron RSUs and stay on he same vesting schedule. Options will be interesting... there probably isn't a lot of value in those currently, so they may chose to cash those out while the liability is low. Higher up the company structure the AIP and Performance Units plans should get some massive value. Rank and file employees won't have any/much of those. Not sure if the restoration plans are still active, but some long-term/high comp EEs will get huge windfalls from these.

I don't know any of this... just educated guesses from seeing details of a dozen or so major mergers. Will be interesting to see how it plays out. Especially interesting to see if this turns into a bidding war for Anadarko given the relatively low exit fee, or if it sparks further consolidation... hello PXD.

Thanks for the explanations.

https://www.rigzone.com/news/chevronanadarko_deal_will_shake_up_us_upstream-15-apr-2019-158596-article/?utm_campaign=DAILY_2019_04_15&utm_source=GLOBAL_ENG&utm_medium=EM_NW_F1

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Staff Cuts?

In a company statement released last week, Chevron Chairman and CEO Michael Wirth said the Anadarko transaction will unlock "significant value for shareholders, generating anticipated annual run-rate synergies of approximately $2 billion".

When asked by Rigzone if the acquisition would result in any staff cuts, Kent Robertson, Chevron's manager of global external affairs, replied with the following statement:

"Anadarko has talented employees who will strengthen our workforce. Until the transaction closes, it's business as usual, and both Chevron and Anadarko will operate as separate companies".

Chevron has more than 45,000 employees, according to its website. Anadarko employs over 4,500 workers, according to its website.

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AgLA06 said:

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cjsag94 said:

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I'd tell him... You've been here less than a week. If you have questions, come see me. Don't go to a public message board, on company time, and start discussing exit packages and business plans.

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And if he worked for you I'd tell him... Get the hell out of there.

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Amen. If he worked for me, I'd tell him to go on public message boards to see what he could find out.

Turmoil breeds opportunity, set yourself up to be adaptable, easy to communicate and work with....you never what could be down the road for you.

I agree. If you prove adaptable, capable and eager to take on work you will likely benefit from transition. You have to remember, Chevron is going to look to upgrade their workforce through this merger. They have staff they likely want to cut.

OXY officially bids $76/share

I just saw that. I had heard that had bid initially, guess they really want it. It will be interesting to watch the bidding war!

What's really interesting is Anadarko is building a new Midland Campus, adjacent to Chevron & Oxy. Interested to see how this plays out.

Man this is gonna be interesting to watch play out.

Plot twist: 3 way deal incoming! Chevroxyco

When Oxy's bid was similar to Chevrons I could understand how they could sell it to their shareholders that it's better to go with Chevron, but $57b vs $33b is a hard pill to swallow, even with a 3% breakup fee.

Engine10 said:

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Man this is gonna be interesting to watch play out.

Plot twist: 3 way deal incoming! Chevroxyco

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XOM could very well get involved one way or another soon...

GarlandAg2012 said:

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When Oxy's bid was similar to Chevrons I could understand how they could sell it to their shareholders that it's better to go with Chevron, but $57b vs $33b is a hard pill to swallow, even with a 3% breakup fee.

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How does Oxy's bid come out to $57B? Based on number of shares and share price I'm coming up with around $39B. I guess they are adding in the debt also, but wouldn't CVX be taking that on as well?

i was just quoting articles I read, you're right. I didn't do the math myself.

https://www.oxy.com/News/Pages/Article.aspx?Article=6055.html

The following is a copy of the letter that Occidental delivered to Anadarko's Board of Directors:

Board of Directors
Anadarko Petroleum Company
c/o H. Paulett Eberhart
and R. A. Walker

April 24, 2019

Dear Members of the Anadarko Board of Directors:

As you know Occidental has long admired Anadarko, and we believe that a combination of our two companies would create a global energy leader with a winning shareholder value proposition. Combining our highly complementary global asset portfolios would generate significant cost and capital synergies, attractive organic growth and a stable, sustainable and growing dividend. The resulting diverse but focused company will be a world leader in shale development and enhanced oil recovery.

Since late March, Occidental has made three acquisition proposals to Anadarko that offered your shareholders a significant immediate premium as well as participation in value creation post closing. Each was significantly higher than the $65 per share transaction you announced on April 12. Our most recent proposal, conveyed in writing on the morning of April 11, followed by a merger agreement we were prepared to sign, was for $76 per share, comprised of 40% cash and 60% stock. We were surprised and disappointed that your Board did not engage with us on that proposal, or our proposal of April 8, even though both were significantly higher than the price you accepted from Chevron.

The transaction you announced with Chevron indicates that the Anadarko Board believes that $65 per share is a fair price for your shareholders. Occidental is hereby proposing to acquire Anadarko for $76 per share, comprised of $38 in cash and 0.6094 shares of Occidental common stock per Anadarko share.
Our proposal represents a premium of approximately 20% to the $63.46 per share value of Chevron's offer as of yesterday's close. The equity component also provides your shareholders an opportunity to continue to participate in the value creation of this exciting combination.

Our Board of Directors has unanimously approved our proposal, and we have executed financing commitments with BofA Merrill Lynch and Citi for the cash portion of our proposal. Our merger agreement will not contain any financing condition, and we do not anticipate any delay to completing the regulatory approval process. We would expect to seek the approval of the shareholders of both companies and close a transaction in the second half of 2019.

It is unfortunate that Anadarko agreed to pay a break up fee of $1 billion, representing approximately $2 per share, without even picking up the phone to speak to us after we made two proposals during the week of April 8 that were at a significantly higher value to the transaction you were apparently negotiating with Chevron.
We noted to you on April 8 that our due diligence is complete. As you are aware, our financial advisors are BofA Merrill Lynch and Citi, and our legal advisors are Cravath, Swaine & Moore LLP, and we and they are available to discuss any aspect of our proposal. We and our advisors have reviewed your merger agreement with Chevron. We are separately sending to you and your legal advisors a form of merger agreement on that basis which we would be prepared to enter into, subject to our agreeing to the disclosure schedules to be attached, together with a copy of our financing commitment letter.

We sincerely hope that you will act now to secure this compelling opportunity for your shareholders without further delay. Our proposal is superior for your shareholders, employees and other stakeholders, and we look forward to concluding the requisite formalities and executing an agreement expeditiously.

Very truly yours
Vicki Hollub
President and Chief Executive Officer
Occidental Petroleum Corporation