Chevron to buy Renewable Energy Group in $3.15bn deal

Chevron has agreed to buy and Renewable Energy Group (REG) in a $3.15bn deal.

The US energy company said on Monday that the acquisition combines REG’s growing renewable fuels production and leading feedstock capabilities with its large manufacturing, distribution and commercial marketing position.

Chevron chairman and chief executive Mike Wirth said: "REG was a founder of the renewable fuels industry and has been a leading innovator ever since. Together, we can grow more quickly and efficiently than either could on its own."

The deal is expected to accelerate progress toward Chevron’s goal to grow renewable fuels production capacity to 100,000 barrels per day by 2030 and brings additional feedstock supplies and pre-treatment facilities.

REG president and CEO CJ Warner said: "This transaction delivers premium cash value to shareholders and will give us additional resources as we aim to accelerate growth and strengthen our collective ability to deliver the sustainable fuels our customers and the world need."

The transaction is expected to be accretive to Chevron earnings in the first year after closing.