Post by CC_Varmints on Oct 26, 2011 18:41:15 GMT -6
Valero Rises on Report of Takeover by India’s Reliance
Valero Energy Corp., the largest independent refiner in the U.S., rose the most in almost three years after a newspaper report said Indian manufacturer Reliance Industries Ltd. is poised to launch a $48-a-share cash bid for the company.
Valero rose 15 percent to close at $25.15 in New York, the most since Nov. 21, 2008. The potential offer, reported in the U.K.’s Daily Mail newspaper, would value San Antonio-based Valero at over $27 billion, more than double its market value of $12.5 billion at the close yesterday in New York.
Some investors who may not find a Reliance bid credible are increasing their holdings because Valero trades at a discount to many other energy companies, Sam Margolin, a refining analyst with Global Hunter Securities LLC in New York, said in a telephone interview today.
“It’s not that people believe it’s going to happen, it’s just one of those things where everybody knows Valero is cheap,” he said.
Valero is trading at a value of roughly two times earnings before interest, taxes, depreciation and amortization, making the company an ideal takeover target, Margolin said.
Valero declined comment on the report, Bill Day, a company spokesman said.
“We just think by any metric, our stock is just not being appreciated,” Valero Chief Executive Officer Bill Klesse told investors in a presentation Sept. 8.
Reliance has sought to boost its refining capacity and its energy footprint in the North America, buying stakes in three shale-gas projects in the U.S. and making failed bids for LyondellBasell Industries NV and Value Creation Inc., a Canadian oil sands company.
www.dailymail.co.uk/money/markets/article-2053517/MARKET-REPORT-Not-slick-Royal-Dutch-Shell-shunned.html
Rumors are swirling that Royal Dutch Shell (RDS A) may get involved in a potential bidding war for Valero Energy (VLO). According to the Daily Mail, Reliance Industries could launch a $48 per share cash offer for Valero. Citibank (C) and JP Morgan (JPM) are said to be advising on a large deal in the energy sector, and analysts believe if Reliance bids for Valero, Shell and CNOOC (CEO) may get involved. (Yahoo Finance)
Reliance Industries (India)
Royal Dutch Shell (The Netherlands)
CNOOC (China)
Valero Energy Corp., the largest independent refiner in the U.S., rose the most in almost three years after a newspaper report said Indian manufacturer Reliance Industries Ltd. is poised to launch a $48-a-share cash bid for the company.
Valero rose 15 percent to close at $25.15 in New York, the most since Nov. 21, 2008. The potential offer, reported in the U.K.’s Daily Mail newspaper, would value San Antonio-based Valero at over $27 billion, more than double its market value of $12.5 billion at the close yesterday in New York.
Some investors who may not find a Reliance bid credible are increasing their holdings because Valero trades at a discount to many other energy companies, Sam Margolin, a refining analyst with Global Hunter Securities LLC in New York, said in a telephone interview today.
“It’s not that people believe it’s going to happen, it’s just one of those things where everybody knows Valero is cheap,” he said.
Valero is trading at a value of roughly two times earnings before interest, taxes, depreciation and amortization, making the company an ideal takeover target, Margolin said.
Valero declined comment on the report, Bill Day, a company spokesman said.
“We just think by any metric, our stock is just not being appreciated,” Valero Chief Executive Officer Bill Klesse told investors in a presentation Sept. 8.
Reliance has sought to boost its refining capacity and its energy footprint in the North America, buying stakes in three shale-gas projects in the U.S. and making failed bids for LyondellBasell Industries NV and Value Creation Inc., a Canadian oil sands company.
www.dailymail.co.uk/money/markets/article-2053517/MARKET-REPORT-Not-slick-Royal-Dutch-Shell-shunned.html
Rumors are swirling that Royal Dutch Shell (RDS A) may get involved in a potential bidding war for Valero Energy (VLO). According to the Daily Mail, Reliance Industries could launch a $48 per share cash offer for Valero. Citibank (C) and JP Morgan (JPM) are said to be advising on a large deal in the energy sector, and analysts believe if Reliance bids for Valero, Shell and CNOOC (CEO) may get involved. (Yahoo Finance)
Reliance Industries (India)
Royal Dutch Shell (The Netherlands)
CNOOC (China)