8-KLeadership ChangesRegulation FDOther Events+1

OCCIDENTAL PETROLEUM CORP /DE/ 8-K Report, Executive Changes (Feb 14, 2014)

Filed February 14, 2014For Securities:OXYOXY-WT

Summary

Occidental Petroleum Corporation (OXY) announced significant strategic changes on February 13-14, 2014, as detailed in this 8-K filing. The company is undergoing a substantial restructuring aimed at focusing operations and enhancing shareholder value. Key among these changes are the increase of its quarterly dividend to $2.88 per share and an authorization to repurchase an additional 30 million shares of common stock, signaling confidence in its financial position and commitment to returning capital to shareholders. Furthermore, Occidental is divesting its Hugoton Field assets for $1.4 billion and is initiating the separation of its California business into a distinct, publicly traded entity. This strategic review aims to streamline operations, allowing Occidental to concentrate on core businesses such as the Permian Basin and its chemical subsidiary, OxyChem. The appointment of Elisse B. Walter, former SEC Chairman, to the Board of Directors also adds significant regulatory and governance expertise.

Key Highlights

  • 1Occidental increased its quarterly dividend to $0.72 per share ($2.88 annually) and authorized an additional 30 million share repurchase program.
  • 2The company agreed to sell its Hugoton Field assets for $1.4 billion as part of a strategic review.
  • 3Occidental announced plans to separate its California business into an independent, separately traded company by late 2014 or early 2015.
  • 4The former SEC Chairman, Elisse B. Walter, was appointed to the Board of Directors, increasing its size to 11.
  • 5The CEO, Mr. Chazen, will remain in his role through the 2016 Annual Meeting of Stockholders to oversee the strategic review.
  • 6Occidental will retain its headquarters in Houston, focusing on Permian Basin and international E&P, midstream, marketing, and OxyChem.
  • 7The separation of the California business is subject to market conditions, regulatory approvals, and final board approval.

Frequently Asked Questions

Occidental Petroleum announced several key strategic initiatives including an increase in its dividend, an expanded share repurchase authorization, the sale of its Hugoton Field assets, and the separation of its California business into a new, independent company. The company is also focusing its operations on core businesses like the Permian Basin and OxyChem.

The sale of Hugoton Field assets for $1.4 billion is expected to generate significant proceeds that will be used to partially fund the increased share repurchase program. This divestiture is part of a strategic review to streamline operations and focus on areas where Occidental has greater depth and scale, aiming to enhance shareholder value.

Occidental plans to separate its California business into an independent, publicly traded company by the end of 2014 or early 2015. This new entity will be California's largest oil and gas producer. The separation is contingent on market conditions, regulatory approvals, and final board approval. Occidental Petroleum will remain headquartered in Houston.

The appointment of Elisse B. Walter, former Chairman of the SEC, brings extensive regulatory and governance expertise to Occidental's Board. Her background with the SEC and FINRA is expected to be valuable as the company navigates its strategic initiatives and maintains strong corporate governance.