A July 2 Business article misidentified the firm for which Mark Palmer works. He is a managing director of Public Strategies Inc., not Public Opinion Strategies. (Published 07/06/05).
China's CNOOC Ltd. energy company submitted its $18.5 billion bid for Unocal Corp. to the federal government for a national security review yesterday, hoping to jump-start the regulatory process while it allays political concerns in Washington.
Typically, such reviews -- carried out by the interagency Committee on Foreign Investment in the United States, or CFIUS -- do not begin until a takeover bid is accepted. But by making its request quickly, CNOOC, which is 70 percent owned by the Chinese government, hoped to signal wary U.S. lawmakers that the company recognizes their concerns and is ready to cooperate. Company officials also hope to convince Unocal shareholders that U.S. regulatory requirements would not unduly delay a deal's completion.
CNOOC's unsolicited bid last week to wrest Unocal from it U.S. suitor, Chevron Corp., has deepened anti-Chinese animosity in Washington. By a vote of 333 to 92, the House on Thursday passed an amendment to an appropriations bill that would bar the Treasury Department -- which leads CFIUS -- from spending any money to approve the CNOOC takeover.
CNOOC has shored up its political position, retaining the law firm Akin Gump Strauss Hauer & Feld LLP to handle its lobbying, and Public Opinion Strategies, a firm with ties to the Bush White House, to lead its public relations. Chevron has been at least as active, mobilizing its Washington office and its large number of contract lobbyists, according to corporate lobbyists familiar with the oil giant's effort.
Chevron, which has offered Unocal shareholders $16.5 billion in cash and stock, yesterday revealed it had already offered promotions to 25 top Unocal executives, available if shareholders accept Chevron's offer. Of those, 20 have already accepted, said Chevron spokesman Charles R. Stewart.
In an interview this week, Chevron Vice Chairman Peter J. Robertson said few Unocal workers outside the company's Southern California headquarters would lose their jobs in an acquisition, implying that CNOOC could make no such promise. The promotions could entice senior Unocal executives to pressure shareholders, while signaling again that a Chevron takeover would be quick and seamless.
Unocal shareholders cannot consider the CNOOC bid until after Aug. 10, when they are scheduled to vote on Chevron's offer, Robertson said. If Chevron is rejected, then CNOOC would begin its regulatory process and security review.
"They're in for a long and drawn-out process," Robertson said.
But Mark Palmer of Public Opinion Strategies said the process would be faster than Chevron depicts. A CFIUS review that finds no threat to national security in a foreign takeover can take less than 30 days, and there is precedent for the process to begin before a takeover bid is formally accepted, he said.
"We want to provide timing and certainty to Unocal stockholders for our superior offer," Palmer said, "and we want the committee to begin the process as soon as possible."