Berkshire Hathaway (NYSE: BRK) and Occidental (NYSE: OXY) have announced a definitive agreement for Berkshire Hathaway to acquire Occidental's chemical business, OxyChem, in an all-cash transaction for $9.7 billion. This transaction is expected to strengthen Berkshire Hathaway's financial position and catalyze a significant resource opportunity in the oil and gas business.
Under the terms of the agreement, Occidental will sell OxyChem to Berkshire Hathaway for cash consideration of $9.7 billion, subject to customary purchase price adjustments. Occidental expects to use $6.5 billion of the transaction proceeds to reduce debt and achieve the target of principal debt below $15 billion set following the December 2023 announcement of its CrownRock acquisition.
OxyChem, a global manufacturer of commodity chemicals with applications in water treatment, pharmaceuticals, healthcare, and commercial and residential development, is said to have grown under Occidental into a well-run, safely operated business with best-in-class employees.
The transaction is expected to close in the fourth quarter of 2025, subject to regulatory approvals and other customary closing conditions.
Berkshire Hathaway, known for its diverse business activities including insurance and reinsurance, utilities and energy, freight rail transportation, manufacturing, services, and retailing, will be acquiring a robust portfolio of operating assets with the acquisition of OxyChem. Occidental, on the other hand, is an international energy company with assets primarily in the United States, the Middle East, and North Africa, and is one of the largest oil and gas producers in the U.S.
This acquisition marks a significant development in the business landscape, with both companies looking to leverage the strengths and opportunities presented by this transaction. Following these announcements, the company's shares moved 0.99%, and are now trading at a price of $47.72. For more information, read the company's full 8-K submission here.
