Chevron To Buy Texaco

NEW YORK--The country’s second-largest oil company, Chevron Corp. is buying No. 3 Texaco for $33.6 million in stock. The deal includes a $1 billion breakup fee abd creates ChevronTexaco, the world’s fourth-largest energy producer.

The transaction comes shortly after Texaco bought out General Motors’ share of Ovonic--which had been a joint venture between GM and the Ovonic Battery Co., a subsidiary of Energy Conversion Devices Inc. Ovonic originated nickel metal hydride (NiMH) batteries for electric and hybrid vehicles. The plan was to commercialize the NiMH battery technology for use in 2003 model year cars.

The fate of the Texaco Ovonic is not yet officially known, but ECD executives said they are pleased.

ECD said that its partnership with Texaco “has been expanded and strengthened” with the Texaco/Chevron merger.

“Chevron has expressed its strong support and excitement to be working with ECD. ChevronTexaco will aggressively pursue the commercialization of energy technologies,” ECD said, noting that fuel cell development is a particular interest of Chevron.

Federal regulators will have to approve the Chevron/Texaco merger.