Chevron is interested in buying Phillips 66's stake in a chemicals joint venture that activist Elliott Investment Management has pushed the refining company to exit, Bloomberg reported.
Chevron wants to increase exposure to petrochemicals at the right price and could target the Chevron Phillips Chemical JV if Phillips 66 is open to it, according to the report, which also said no talks are underway and that it is unclear whether Phillips 66 is amenable to parting with the stake.
Elliott, which disclosed its plan for changes at Phillips 66 earlier this month, said in its materials that the chemical JV stake could be worth ~$15B in a potential sale, although the valuation could vary considerably depending on the outlook for chemical margins, which currently are near multi-year lows.
Chevron CEO Mike Wirth told Bloomberg in a recent interview that chemicals has "robust demand growth" as more people enter the middle class globally and the need rises for energy-efficient, lightweight plastics in airplanes and vehicles.
Both companies have a right-of-first-refusal over each other’s stakes in the chemicals JV.
