Two weeks after announcing its intentions to acquire the remaining shares of Pure Resources Inc., El Segundo, CA-based Unocal Corp. on Thursday said it has commenced the exchange offer to shareholders of Pure (see Daily GPI, Aug. 21). Under the offer, Unocal said it is seeking the 35% of outstanding common stock in the company that it does not already own.

Through its subsidiary Union Oil Co. of California, Unocal currently owns 65% of Pure’s shares. The company said its exchange offer is scheduled to expire on Oct. 2. Pure was formed in May 2000 through the combination of Titan Exploration Inc. and Unocal’s Permian Basin business unit (see Daily GPI, Dec. 15, 1999).

Stockholders of Pure are being offered 0.6527 shares of Unocal common stock in exchange for each of their shares of common stock. Assuming a successful completion of the exchange offer, Unocal said it would then effect a short form merger of Pure with a Unocal subsidiary. Shares of Pure still held by the remaining public stockholders would be converted into the same consideration paid in the exchange offer, except for shares owned by stockholders who exercise appraisal rights.

Unocal estimated that if all of Pure’s stockholders choose to tender their shares, Unocal would issue approximately 15.6 million shares in the transaction. The transaction is subject to a number of conditions including that Unocal own at least 90%of the outstanding shares of Pure common stock at the completion of the exchange offer.

Unocal said a prospectus is currently being mailed to stockholders of Pure. In addition, the company has filed its registration statement on Form S-4 and a Schedule TO with the Securities and Exchange Commission (SEC). Investors and stockholders can obtain free copies of these documents through the SEC’s web site, www.sec.gov.

©Copyright 2002 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.