At first glance, Oxy and Anadarko’s $38 billion takeover of the shale oil producer looked like a terrible decision. While many investors were betting against the merger, CEO Vicki Hollub was determined to make it work. Fast forward two years later and the merger has become one of the most successful in energy history. So how did an unpopular decision end up turning into a major success? In this blog post, we dive deep into the story of how CEO Vicki Hollub made ‘The Dumbest Deal in History’ pay off for all involved.
Oxy and Anadarko’s merger
In 2016, Oxy and Anadarko announced their merger, creating one of the world’s largest oil and gas companies. The deal was widely criticized at the time as being overvalued and a poor strategic fit. However, CEO Vicki Hollub remained confident in the merger, and it has since proven to be a success.
The combined company is now worth over $100 billion and is one of the leading players in the oil and gas industry. The merger has allowed Oxy to expand its operations into new areas, such as the Permian Basin, and has given Anadarko access to Oxy’s world-class asset portfolio.
The merger has also been beneficial for shareholders. Since the deal was announced, Oxy’s stock price has more than doubled, and Anadarko’s stock price has quadrupled. This increase in shareholder value is largely due to the operational synergies between the two companies that have been realized since the merger.
Despite initial concerns, it is clear that the Oxy-Anadarko merger has been a success. It has created value for shareholders and positioned the combined company as a leader in the oil and gas industry.
CEO Vicki Hollub’s role in the merger
In 2016, Occidental Petroleum Corporation (Oxy) and Anadarko Petroleum Corporation announced a merger that would make Oxy the largest oil and gas producer in the Permian Basin. The deal, worth $38 billion, was widely criticized as being too risky and expensive.
However, under the leadership of CEO Vicki Hollub, the merger has been a success. Thanks to Hollub’s experience in the oil industry, she was able to quickly integrate the two companies and streamline their operations. The result has been increased production and higher profits.
The success of the merger has solidified Hollub’s reputation as an expert in the oil industry, and she is now considered one of the most powerful women in business.
The benefits of the merger for Oxy and Anadarko
The benefits of the merger for Oxy and Anadarko are numerous. For one, it creates a much larger company that is better able to compete in the oil and gas industry. The combined company is also more diversified, with a larger portfolio of assets and a greater geographical reach. Additionally, the merger gives Oxy access to Anadarko’s world-class asset base in the Permian Basin, which is one of the most prolific oil-producing regions in the world. Finally, the merger will allow Oxy to realize significant cost savings through economies of scale.
The criticism of the merger
The $38 billion merger of Oxy and Anadarko was widely criticized as a bad move for both companies. The deal was dubbed the “dumbest deal in history” by some, and it was seen as a desperation move by Oxy to save itself from bankruptcy.
The criticism was largely based on the fact that the two companies had very different operations. Oxy was a big oil producer, while Anadarko was a smaller player with a focus on natural gas and chemicals. The two companies also had different cultures, with Oxy being a more risk-averse and conservative company, while Anadarko was known for being more entrepreneurial.
The biggest concern was that the two companies would not be able to mesh their operations and cultures together. This proved to be true in the early days of the merger, as there were massive layoffs and cost-cutting measures taken by the new company.
However, the merger has started to pay off in recent years, as the combined company has been able to streamline its operations and become more profitable. Under the leadership of CEO Vicki Hollub, who is seen as a driving force behind the success of the merger, the combined company is now one of the largest oil producers in the world.
How the merger has paid off for CEO Vicki Hollub
The Anadarko-Oxy merger was billed as the “dumbest deal in history” when it was announced in 2019. But, two years later, the merger has paid off handsomely for CEO Vicki Hollub.
In the wake of the merger, Hollub has emerged as one of the most powerful women in the energy industry. She is now at the helm of a combined company that is worth more than $70 billion and produces more than 2 million barrels of oil equivalent per day.
The Anadarko-Oxy merger has also been a boon for shareholders. The combined company’s stock has surged more than 50% since the deal was announced. And, analysts expect the company to continue to outperform its peers in the years ahead.
So, while the Anadarko-Oxy merger may have been “dumb” from a financial perspective, it has been a huge success for CEO Vicki Hollub. Thanks to her vision and leadership, the combined company is well positioned to thrive in the years ahead.
Conclusion
The ‘Dumbest Deal in History’ of Oxy and Anadarko’s has been a remarkable success story for CEO Vicki Hollub. With her bold decision to go ahead with the deal, she was able to turn around two struggling companies into one powerhouse that is now worth billions. Other CEOs can learn from this example by understanding how important it is to take risks and trust their instincts if they want to achieve success in their own businesses. “Be fearless” are words that have worked for Hollub – perhaps these same words will work for other leaders today as well.
