Occidental Petroleum’s (NYSE:OXY) stock climbed over 1% in premarket trading after reports indicated that the company is in advanced negotiations to sell its chemical unit, OxyChem, for a figure of at least $10 billion.
Barclays noted that the potential divestment “would accelerate balance sheet normalization and position the company to increase cash returns.”
Sources suggest that Occidental is actively discussing the sale, with an official announcement expected in the coming weeks.
“This news follows our Outlook 2030 deep dive on OXY, where we highlighted balance sheet normalization as a central focus for the company,” Barclays added.
The bank also remarked that the move would represent a “strategic change for OXY, but would clearly accelerate deleveraging and the transition to higher cash returns, developments we believe would be viewed positively by the market.”
OxyChem ranks among the top global producers of chlor-alkali, PVC, and caustic potash, and is also one of the largest sellers of caustic soda worldwide.
Barclays highlighted that Occidental’s management has previously emphasized OxyChem’s “stable cash flow and synergies with the company’s Direct Air Capture initiatives,” a point CEO Vicki Hollub mentioned at a Barclays conference last year.
From a financial perspective, Barclays forecasts OxyChem’s EBITDA to reach roughly $1.24 billion in 2025, rising to $1.46 billion by 2027, backed by a $1.5 billion upgrade at the Battleground facility on the Gulf Coast.
The reported $10 billion price tag implies an estimated EBITDA multiple of about 7x for 2026–2027, compared with Occidental’s current valuation of 5.7x and 5.4x for the same years.
“Even assuming a 15% tax on proceeds, the deal would remain modestly accretive at 6.2x on 2026E EBITDA,” Barclays said.
Occidental Petroleum stock price
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