WHITE PLAINS, N.Y. -- The Texaco Alliance Trust today signed definitive agreements to sell its refining, pipeline and retail fuel marketing interests in Equilon Enterprises LLC and Motiva Enterprises LLC to Shell Oil Co. and Saudi Refining Inc. for $3.86 billion, consisting of $2.26 billion in cash (including about $160 million in dividends) and the assumption of approximately $1.6 billion in debt and liabilities.
Combined, Equilon and Motiva--the marketing joint ventures operated by the three companies prior to the merger of Texaco with Chevron Corp.--own eight refineries, 30,000 miles of pipeline, a trading enterprise and market in about 23,000 branded service stations in the U.S. The Trust, which was formed after the Federal Trade Commission required that Texaco sell its share of the joint ventures as a condition of the Chevron merger, currently owns 44 percent of Equilon (with Shell holding 56 percent) and 35 percent of Motiva (with Shell holding 30 percent and SRI the remaining 35 percent). Upon completion of the transaction, Shell will own 100% of Equilon and Shell and SRI will each hold a 50-percent interest in Motiva.
“We are pleased that we were able to structure the definitive agreements within the terms of the MOU and that the negotiations were completed expeditiously so that all parties may move forward,” said Robert A. Falise, who was selected as Chairman and Divestiture Trustee, and was given full authority to dispose of the businesses within an eight-month period following the ChevronTexaco merger. Falise said he expects the deal to be completed by mid-January, following an FTC review.
In a statement released by ChevronTexaco yesterday, the company expressed satisfaction that the deal is headed toward closure. “We are pleased with today’s announcement of the signing of definitive agreements by the Texaco Alliance Trust, Shell Oil Co. and Saudi Refining Inc. for the sale of interests in Equilon and Motiva that were formerly held by subsidiaries of Texaco Inc. The Texaco Alliance Trust has done an impressive job in expeditiously completing these agreements, which are consistent with the memorandum of understanding that Texaco signed with Shell Oil Co. and Saudi Refining Inc. prior to the closure of Texaco’s merger with Chevron.”
Meanwhile, John Boles, president of Equiva Trading Co., has been elected president and CEO of Motiva Enterprises, said Mike Warwick, chairman of the Motiva Enterprises board. Boles assumes his new position effective immediately. He replaces the retiring Roger Ebert.
Boles joined Getty Oil Co. in 1973 at the Delaware City, Del., refinery. He worked in Getty’s refining and fiscal organizations in Tulsa from 1977 to 1984. Following Texaco’s acquisition of Getty in 1984, Boles held various planning and operational positions with Texaco USA and Texaco Refining and Marketing Inc. in Houston.
He was named vice president of planning and administration for TRMI in Los Angeles in 1993. He was appointed COO of Star Enterprise in 1996, vice president of portfolio planning and development for Equilon Enterprises in 1998 and senior vice president of Equiva Trading in March 2000. Boles became president of Equiva Trading in May 2000.
