Exxonmobil Case Study

783 Words 4 Pages
ExxonMobil Corporation is one of the world’s largest oil companies. Their worldwide operations consist of four major divisions including Upstream, Downstream, Chemical, and Natural Gas and Power Marketing divisions. The upstream division consists of capturing all resource types such as a combination of oil and gas projects (“Learn about ExxonMobil’s upstream operations,” n.d.). The downstream division consists of refining and distributing products from crude oil and other segments such as fuels and lubricants (“Learn about downstream operations at ExxonMobil,” n.d.). The chemical division deals with products such as packaging materials, plastic bottles, solvents, and a countless array of goods (“Learn about ExxonMobil Chemical,” n.d.). The natural gas and power marketing division is just what it sounds like. This division promotes all ExxonMobil products worldwide and is charged with growing the company (“Learn about Natural Gas and Power Marketing at ExxonMobil,” n.d.).
Any business decision within each division affects the entire company in many areas including their weighted average cost of capital. The cost of capital has a major influence over a company’s operations and profitability (Easley & O’Hara, 2004, pg. 1553). One way that companies can influence their cost of capital is “by affecting the precision and quantity of information available to
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286). There are various benefits to using WACC including any interest payments associated with the debt is tax-deductible (Beech & Thayser, 2015, pg. 30). However, When ExxonMobil acquired XTO Energy in 2009 for $41 billion, it was acquired by a combination of preferred stock and common stock (“Exxon Mobil Corporation and XTO Energy Inc. Announce Agreement | ExxonMobil News Releases,”

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