Today, Occidental Petroleum Corp (NYSE:OXY), a $45.8 billion energy company currently trading at $48.84 per share and considered undervalued according to InvestingPro’s Fair Value analysis, announced a temporary reduction in the exercise price of its publicly traded warrants. This amendment to the Warrant Agreement, initiated on March 3, 2025, lowers the exercise price from $22.00 to $21.30 per share of common stock. The revised terms are part of the Offer to Exercise Warrants, which remains open until 5:00 p.m. (Eastern Time) on March 31, 2025, unless extended by the company.
The warrants in question allow holders to purchase shares of Occidental Petroleum’s common stock at a predetermined price. This strategic move is detailed in the Warrant Agreement Amendment between Occidental Petroleum and Equiniti Trust Company, LLC, who serves as the Warrant Agent. The company, which has maintained dividend payments for 52 consecutive years and currently offers a 1.97% yield, emphasizes that apart from the exercise price adjustment, all other conditions of the warrants as stipulated in the original Warrant Agreement continue unchanged.
The Offer to Exercise Warrants coincides with the company’s filing of a prospectus supplement related to the common stock issuable upon the exercise of the warrants. This filing is in line with Occidental Petroleum’s existing effective shelf registration statement.
Investors interested in exercising their warrants at the reduced price can do so under the terms of the Offer to Exercise. Post the Expiration Date, the opportunity to exercise warrants at the discounted rate will no longer be available. According to InvestingPro, analysts have set price targets ranging from $47 to $81 per share, with comprehensive analysis available in the Pro Research Report, one of 1,400+ detailed company analyses available to subscribers. The company has provided a comprehensive prospectus supplement and has filed all necessary documentation with the U.S. Securities and Exchange Commission, ensuring full transparency and compliance.
This information is based on a press release statement and the detailed terms of the agreement and accompanying documents can be referenced in the company’s SEC filings, specifically the First Amendment to Warrant Agreement and the opinion of Cravath, Swaine & Moore LLP regarding the validity of the common stock involved.
In other recent news, Occidental Petroleum has reached a significant milestone by achieving its near-term debt repayment target, paying off $4.5 billion in the last quarter of 2024. The company has also signed agreements to divest certain upstream assets for $1.2 billion in the first quarter of 2025, which will be directed towards remaining debt maturities. In a related development, Fitch Ratings upgraded Occidental’s outlook from Stable to Positive, citing the company’s accelerated debt repayment strategy and a clear plan for additional debt reduction. Meanwhile, Goldman Sachs downgraded Occidental’s stock rating from Neutral to Sell, lowering the price target to $45, suggesting that the company’s focus on debt reduction may limit returns to shareholders in the near term. Occidental’s recent acquisition of CrownRock has bolstered production, adding high-margin output in the Midland Basin and contributing to the company’s strong performance. The company also announced that its direct air capture plant in Texas is 94% complete and expected to come online this year, as part of its low carbon initiatives. Additionally, Occidental’s integrated business model, including chemicals and midstream operations, is expected to see growth with the planned expansion of the Battleground, TX chlor-alkali plant in 2026. These recent developments reflect Occidental’s strategic focus on deleveraging and operational expansion.
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