Valero Acquires Premcor, Inc.

Valero Energy will acquire Premcor, Inc. for $6.9 billion in cash and stock, creating the largest refiner of crude oil in North America. In the merger agreement, Valero will issue $3.5 billion in stock and pay $3.4 billion in cash. Valero will also assume about $1.8 billion in Premcor debt. The merger will add four refineries and 790,000 barrels per day to the Valero system.

Under the proposed acquisition, Valero will have total assets of $25 billion and annual revenues of approximately $70 billion, which will rank it as # 15 on the Fortune 500 list. By adding Premor's refineries in Port Arthur, Texas, Memphis, Tennessee, Delaware City, Delaware, and Lima, Ohio, Valero, which is based in San Antonio, Texas, will have 19 refineries with a total throughput capacity of 3.3 million barrels per day.

Premcor, which is based in Old Greenwich, Connecticut, is one of the largest independent refiners and suppliers of unbranded transportation fuels, heating oil, petrochemical feedstocks, petroleum coke, and other petroleum products in the United States.