Under the deal terms, Chevron will pay $61.50/share, a ~40% premium over Friday's $43.81 closing price.
Chevron expects the deal will accelerate its progress toward a goal to boost its renewable fuels production capacity to 100K bbl/day by 2030, and provide additional feedstock supplies and pre-treatment facilities.
Chevron sees the transaction as accretive to its earnings in the first year after closing and accretive to free cash flow after the start-up of Renewable Energy's Geismar expansion.
Upon the deal closing, Chevron's renewable fuels business will be headquartered in Ames, Iowa; Renewable Energy CEO Cynthia Warner will join the Chevron board.
Renewable Energy is set to release Q4 results on March 1.