Chinese Oil Firm Makes $18.5 Bln. Bid for Unocal

hina’s third-largest oil producer made an unsolicited $18.5 billion offer Thursday for U.S. oil company Unocal Corp., marking that country’s most ambitious attempt to acquire a Western company, news services reported.

The bid could lead to a showdown with U.S. public officials concerned about possible national security implications of such a deal, the Associated Press reported.

The purchase by state-owned Cnooc Ltd. — an affiliate of China National Offshore Oil Corp. — would be the biggest in a multibillion-dollar wave of foreign acquisitions by Chinese firms, AP said.

Cnooc is offering $67 a share for Unocal, the Wall Street Journal reported Thursday. It would also have to pay a $500 million breakup fee and would assume Unocal’s $1.6 billion in debt, the paper said.

Unocal had agreed to be acquired by Chevron Corp. for $16.6 billion, but said it would evaluate the Cnooc offer, AP reported. Unocal said its board’s earlier recommendation to shareholders to accept the Chevron offer remained in place.

Chevron offered in April to acquire El Segundo, Calif.-based Unocal in a deal that would give Unocal shareholders a choice of $65 per share in cash, Chevron stock, or a mix of stock and cash, AP said.

A Cnooc takeover of Unocal would require approval from a U.S. government panel that examines the national security implications of selling American companies to foreigners, according to Energy Secretary Samuel Bodman, AP reported.