Filed by Chevron Corporation Pursuant to Rule 425 under the Securities Act of
1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act
of 1934.
Subject Company: Texaco Inc.
Commission File No. 1-27
Date: October 17, 2000
Except for the historical and present factual information contained
herein, the matters set forth in this filing, including statements as to the
expected benefits of the merger such as efficiencies, cost savings, market
profile and financial strength, and the competitive ability and position of the
combined company, and other statements identified by words such as "expects,"
"projects," "plans," and similar expressions are forward-looking statements
within the meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ materially,
including the possibility that the anticipated benefits from the merger cannot
be fully realized, the possibility that costs or difficulties related to the
integration of our businesses will be greater than expected, the impact of
competition and other risk factors relating to our industry as detailed from
time to time in each of Chevron's and Texaco's reports filed with the SEC.
Chevron and Texaco disclaim any responsibility to update these forward-looking
statements.
Chevron and Texaco will file a proxy statement/prospectus and other
relevant documents concerning the proposed merger transaction with the SEC.
Investors are urged to read the proxy statement/prospectus when it becomes
available and any other relevant documents filed with the SEC because they will
contain important information. You will be able to obtain the documents free of
charge at the website maintained by the SEC at www.sec.gov. In addition, you may
obtain documents filed with the SEC by Chevron free of charge by requesting them
in writing from Chevron Corporation, 575 Market Street, San Francisco, CA 94105,
Attention: Corporate Secretary, or by telephone at (415) 894-7700. You may
obtain documents filed with the SEC by Texaco free of charge by requesting them
in writing from Texaco Inc., 2000 Westchester Avenue, White Plains, New York
10650, Attention: Secretary, or by telephone at (914) 253-4000.
Chevron and Texaco, and their respective directors and executive
officers, may be deemed to be participants in the solicitation of proxies from
the stockholders of Chevron and Texaco in connection with the merger.
Information about the directors and executive officers of Chevron and their
ownership of Chevron stock is set forth in the proxy statement for Chevron's
2000 annual meeting of stockholders. Information about the directors and
executive officers of Texaco and their ownership of Texaco stock is set forth in
the proxy statement for Texaco's 2000 annual meeting of stockholders. Investors
may obtain additional information regarding the interests of such participants
by reading the proxy statement/prospectus when it becomes available.
* * *
[Chevron and Texaco Company Factsheets]
[Chevron logo] Chevron Corporation
Fact Sheet
Chevron Corporation (NYSE: CHV), one of the world's largest integrated petroleum
companies, is involved in every aspect of the oil and gas industry, from
exploration and production to transportation, refining and retail marketing, as
well as chemicals manufacturing and sales. Active in more than 90 countries,
Chevron employs about 31,000 people worldwide.
Primary Financial Goals:
-------------------------
* No. 1 in total shareholder return for the 2000-2004
period versus industry peers
* 15 percent earnings per-share growth over the next
three years
* 12 percent minimum return on capital employed
* 4-4.5 percent annual worldwide net production growth in barrels of oil
equivalent
* Operating expense of $4.85 per barrel or lower by 2001
Exploration and Production (upstream)
---------------------------------------
Chevron is one of the leaders in worldwide liquids production. The company's
strategy of focusing on international upstream activities has resulted in
international liquids production increasing for 10 consecutive years. The
company has extensive oil and natural gas production outside North America in
such diverse environments as Kazakhstan, Angola, Nigeria, the North Sea,
Australia, Indonesia, Venezuela, Republic of Congo, Thailand, China and Papua
New Guinea. In North America, major producing areas include the Gulf of Mexico,
California, Texas and off the east coast of Canada.
Refining/Marketing/Transportation (downstream)
-----------------------------------------------
Chevron is one of the largest U.S. marketers of gasoline, diesel fuel, jet fuel,
aviation fuel and other petroleum products. Chevron's gasoline sales are focused
in the western, southwestern and southern United States through about 8,000
retail outlets. Major refineries are located at El Segundo and Richmond, Calif.;
Pascagoula, Miss.; Salt Lake City, Utah; El Paso, Texas; and Honolulu, Hi.
Chevron is also the leading marketer in British Columbia, Canada. Caltex
Corporation, a 50 percent joint venture with Texaco, is Chevron's refining and
marketing arm in the Asia-Pacific region, the Middle East and southern and
eastern Africa. The Caltex network includes refining, marketing, supply,
trading, distribution, shipping and storage of crude oil and petroleum products.
Chemicals
---------
Chevron Phillips Chemical Co. is a world-scale competitor in the petrochemicals
industry. It manufactures and markets a variety of industrial chemicals in more
than 80 countries worldwide. Major products include styrene, polystyrene and
olefins, as well as additives for fuels and lubricants.
<TABLE>
<CAPTION>
Financial Highlights (year ended December 31)
----------------------------------------------
(In millions of dollars except per share amount) 1999 1998
--------------------------------------------------------------------------
<S> <C> <C>
Operating Revenue* $35,448 $29,943
Net Income $2,070 $1,339
Total Assets $40,668 $36,540
Earnings per Share Basic $3.16 $2.05
Diluted $3.14 $2.04
Average diluted common shares (millions) 656,345 653,026
* Includes sales to other Chevron Companies
</TABLE>
<TABLE>
<CAPTION>
Operating Statistics
----------------------
(Per Day) 1999 1998
--------------------------------------------------------------------------
<S> <C> <C>
Net Liquids Production (Thousands of Barrels) 1,127 1,107
Net Natural Gas Production (Millions of Cubic Feet) 2,513 2,393
Sales of Natural Gas (Millions Cubic Feet) 4,936 4,807
Refinery Input (Thousands of Barrels) 1,423 1,343
Headquarters 575 Market Street
San Francisco, CA 94105
www.Chevron.com
</TABLE>
<PAGE>
[Texaco logo] Texaco Incorporated
Fact Sheet
Texaco Inc. (NYSE: TX) is a fully integrated energy company engaged in exploring
and producing oil and natural gas; manufacturing and marketing high-quality
fuels and lubricant products; operating trading, transportation and distribution
facilities; and producing power. Directly and through affiliates, Texaco
operates in more than 150 countries.
Exploration and Production
--------------------------
Texaco is transforming its global portfolio of oil and natural gas assets with
new legacy projects. Our focused exploration program is concentrated in
deepwater Gulf of Mexico, Brazil and West Africa with major development projects
in Nigeria, Kazakhstan, Venezuela and the Philippines. Core production areas
include the United States, the UK North Sea, the Middle East and the Pacific
Rim. Texaco's high impact strategy concentrates on finding and commercializing
projects characterized by large-scale reserves, 25-40 year production lives and
high margins. For instance, Texaco's billion barrel discovery offshore Nigeria,
called Agbami, will produce about 180,000 barrels of oil equivalent a day.
Texaco is replacing existing non-strategic assets with new impact projects
measured on key return metrics to lay the foundation for "smart" growth and
deliver superior value to its shareholders.
Refining, Marketing and Distribution
------------------------------------
Directly and through its affiliates, Texaco's global operations provide crude
oil products in 110 countries. In Latin America and the Caribbean, Texaco is the
leading marketer of lubricants and fuels, and we have a strong marketing and
refining presence in Northwest Europe. Caltex Corporation, our joint venture
with Chevron, has a major presence in Asia-Pacific, the Middle East and Africa.
A few years ago Texaco formed two major joint ventures to increase efficiency
and gain superior market share. Equilon combines the elements of Texaco's and
Shell's Western and Midwestern U.S. refining and marketing businesses and their
nationwide trans-portation and lubricants business. Motiva combines the refining
and marketing businesses of Texaco, Shell and Saudi Aramco in the East and Gulf
Coast. These alliances are streamlining their operations, continuing to
capitalize on value-enhancing synergies and building superior market share in
their focus areas.
Global Gas and Power
--------------------
Texaco is identifying new opportunities to leverage strengths in natural gas,
power generation and gasification technology. Texaco is one of the largest
natural gas producer- marketers in the United States, operating more than 1,500
miles of pipeline, 50 interconnects and eight billion cubic feet of storage.
Texaco currently has equity interests in 47 power projects operating or under
development around the world, with a total generating capacity in excess of
5,400 megawatts. Additionally, Texaco is the recognized leader in gasification
technology, an environmentally superior process that can convert low-value
materials - like refinery residue - into a clean synthesis gas.
Advanced Energy Technology
--------------------------
Texaco is actively engaged in the development and commercialization of
environmentally smart advanced technologies such as fuel cells, photovoltaics,
advanced batteries and hydrogen storage. Market forces and rising environmental
standards are driving the development of the next generation of energy products
and is positioning itself to be a leader in this technological future.
<TABLE>
<CAPTION>
Financial Highlights (year ended December 31)
---------------------------------------------
(In millions of dollars except per share amount) 1999 1998
-------------------------------------------------------------------------------
<S> <C> <C>
Operating Income $1,214 $894
Operating Expanses $2,319 $2,508
Net Income $1,177 $578
Total Assets $28,972 $28,570
Earnings per Share
Basic $2.14 $0.99
Diluted $2.14 $0.99
Average Common Shares Diluted (millions) 537,860 528,965
</TABLE>
<TABLE>
<CAPTION>
Operating Statistics
--------------------
(Per Day, Worldwide) 1999 1998
--------------------------------------------------------------------------------
<S> <C> <C>
Net Liquids Production (Thousands of Barrels) 885 930
Net Natural Gas Production (Millions of Cubic Feet) 1,999 2,227
Sales of Natural Gas (Millions Cubic Feet) 3,940 4,537
Refinery Input (Thousands of Barrels) 1,491 1,530
</TABLE>
Financial Goals
---------------
* Grow earnings 10-13% annually
* Deliver 11-13% return on capital employed over next four years
* Generate top-quartile cash from operations
* Maintain strong "A" credit rating
Headquarters
------------
2000 Westchester Avenue
White Plains, NY 10650
www.Texaco.com
Contact Information Media Relations
------------------- ---------------
Investor Services Phone: 914.253.4177
Phone: 800.283.9785 E-mail: [email protected]
E-mail: [email protected]
--------------------------------------------------------------------------------
Private Securities Litigation Reform Act Safe Harbor Statement
-----------------------------------------------------------------
Except for the historical and present factual information contained herein, the
matters set forth above, including statements as to the expected benefits of the
merger such as efficiencies, cost savings, market profile and financial
strength, and the competitive ability and position of the combined company, and
other statements identified by words such as "expects," "projects," "plans," and
similar expressions are forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including the possibility
that the anticipated benefits from the merger cannot be fully realized, the
possibility that costs or difficulties related to the integration of our
businesses will be greater than expected, the impact of competition and other
risk factors relating to our industry as detailed from time to time in each of
Chevron's and Texaco's reports filed with the SEC. Chevron and Texaco disclaim
any responsibility to update these forward-looking statements.
Additional Information
----------------------
Chevron and Texaco will file a proxy statement/prospectus and other relevant
documents concerning the proposed merger transaction with the SEC. Investors are
urged to read the proxy statement/prospectus when it becomes available and any
other relevant documents filed with the SEC because they will contain important
information. You will be able to obtain the documents free of charge at the
website maintained by the SEC at www.sec.gov. In addition, you may obtain
documents filed with the SEC by Chevron free of charge by requesting them in
writing from Chevron Corporation, 575 Market Street, San Francisco, CA 94105,
Attention: Corporate Secretary, or by telephone at (415) 894-7700. You may
obtain documents filed with the SEC by Texaco free of charge by requesting them
in writing from Texaco Inc., 2000 Westchester Avenue, White Plains, New York
10650, Attention: Secretary, or by telephone at (914) 253-4000.
Chevron and Texaco, and their respective directors and executive officers, may
be deemed to be participants in the solicitation of proxies from the
stockholders of Chevron and Texaco in connection with the merger. Information
about the directors and executive officers of Chevron and their ownership of
Chevron stock is set forth in the proxy statement for Chevron's 2000 Annual
Meeting of stockholders. Information about the directors and executive officers
of Texaco and their ownership of Texaco stock is set forth in the proxy
statement for Texaco's 2000 Annual Meeting of stockholders. Investors may obtain
additional information regarding the interests of such participants by reading
the proxy statement / prospectus when it becomes available.
Investors should read the proxy statement/prospectus carefully when it becomes
available before making any voting or investment decisions.
<PAGE>
* * *
[Chevron Texaco Merger Transaction Overview - Revised October, 17, 2000]
[Chevron logo] [Texaco logo]
TRANSACTION OVERVIEW
Merger Creates A U.S.-Based, Global
Enterprise That Is Highly Competitive Across
All Energy Sectors
================================================================================
Terms o More than $100 billion enterprise value
o Texaco shareholders to receive .77 shares of Chevron
common stock for each share of Texaco common stock they
own, representing approximately $64.87 per Texaco share
based on the closing price of Chevron common stock on
October 13, 2000
o Chevron shareholders to retain existing shares
o Chevron shareholders to own approximately 61% of
ChevronTexaco
o Texaco shareholders to own approximately 39% of
ChevronTexaco
o Accretive to earnings and cash flow per share upon
realization of cost savings
================================================================================
Combined o Headquarters: San Francisco, California
Company Facts o Operations throughout the world
o Year-end 1999 reserves of 11.2 billion BOE
o 1H 2000 combined daily production of
2.7 million BOE
o Assets of $77 billion
o Third-largest oil and gas producer in the
United States
- Production of 1.1 million BOE per day
- Nation's third largest reserve position
- 4.2 billion BOE of proved reserves
================================================================================
Cost Savings o Significant annual cost savings of at least $1.2
billion to be achieved within 6-9 months of merger
close
- Approximately $700 million to come from more
efficient exploration and production
- Approximately $300 million to come from
consolidation of corporate functions and $200
million from other operations
- Combined workforce of about 57,000 to be reduced
by approximately 7% worldwide
o Chevron and Texaco have proven track records of
achieving cost savings
================================================================================
Management, o Senior management:
Integration - Dave O'Reilly - Chairman & CEO
and Board - Richard Matzke - Vice Chairman, Upstream
- Peter Bijur - Vice Chairman, Downstream,
Power and Chemicals
o Integration team to be led by:
- John Watson - Chevron Vice President and CFO
- Patrick Lynch - Texaco Senior Vice President and
CFO
o Board of Directors to be proportional to equity split
================================================================================
Closing o Shareholder approvals of Chevron and Texaco
Conditions o Regulatory clearances
o Pooling of accounting treatment
o Chevron and Texaco anticipate that the FTC will require
certain divestitures in the U.S. downstream business in
order to address market concentration issues, and the
companies intend to cooperate with the FTC in this
process
================================================================================
Private Securities Litigation Reform Act Safe Harbor Statement
-----------------------------------------------------------------
Except for the historical and present factual information contained herein, the
matters set forth above, including statements as to the expected benefits of the
merger such as efficiencies, cost savings, market profile and financial
strength, and the competitive ability and position of the combined company, and
other statements identified by words such as "expects," "projects," "plans," and
similar expressions are forward-looking statements within the meaning of the
"safe harbor" provisions of the Private Securities Litigation Reform Act of
1995. These forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially, including the possibility
that the anticipated benefits from the merger cannot be fully realized, the
possibility that costs or difficulties related to the integration of our
businesses will be greater than expected, the impact of competition and other
risk factors relating to our industry as detailed from time to time in each of
Chevron's and Texaco's reports filed with the SEC. Chevron and Texaco disclaim
any responsibility to update these forward-looking statements.
Additional Information
----------------------
Chevron and Texaco will file a proxy statement/prospectus and other relevant
documents concerning the proposed merger transaction with the SEC. Investors are
urged to read the proxy statement/prospectus when it becomes available and any
other relevant documents filed with the SEC because they will contain important
information. You will be able to obtain the documents free of charge at the
website maintained by the SEC at www.sec.gov. In addition, you may obtain
documents filed with the SEC by Chevron free of charge by requesting them in
writing from Chevron Corporation, 575 Market Street, San Francisco, CA 94105,
Attention: Corporate Secretary, or by telephone at (415) 894-7700. You may
obtain documents filed with the SEC by Texaco free of charge by requesting them
in writing from Texaco Inc., 2000 Westchester Avenue, White Plains, New York
10650, Attention: Secretary, or by telephone at (914) 253-4000.
Chevron and Texaco, and their respective directors and executive officers, may
be deemed to be participants in the solicitation of proxies from the
stockholders of Chevron and Texaco in connection with the merger. Information
about the directors and executive officers of Chevron and their ownership of
Chevron stock is set forth in the proxy statement for Chevron's 2000 Annual
Meeting of stockholders. Information about the directors and executive officers
of Texaco and their ownership of Texaco stock is set forth in the proxy
statement for Texaco's 2000 Annual Meeting of stockholders. Investors may obtain
additional information regarding the interests of such participants by reading
the proxy statement / prospectus when it becomes available.
Investors should read the proxy statement/prospectus carefully when it becomes
available before making any voting or investment decisions.
# # #
