HOUSTON, May 28 (Reuters) - Hess Corp ( HES )

shareholders will vote on Tuesday on Chevron's ( CVX ) proposed

$53 billion acquisition of the company, after many investors

have called for a delay in hopes of obtaining a better offer for

their shares.

The vote has huge implications for both companies. The deal

has been stalled in part by a regulatory review and clouded by

an arbitration dispute with Exxon Mobil ( XOM ), which could

push the deal's closing to 2025 or result in its termination.

The deal spread, a Wall Street measure of investor

confidence in the completion of a proposed merger, has climbed

to about $10, double the initial spread, indicating greater risk

perception over the transaction.

Chevron ( CVX ) is counting on approval to win a foothold in

oil-rich Guyana's lucrative offshore fields. A deal failure

would leave Hess as a standalone company with little immediate

prospect of a new bid.

Hess needs a majority of its 308 million outstanding shares

to seal the all-stock deal with its shareholders and make it

more difficult for other potential rivals to outbid Chevron ( CVX ).

While Exxon has expressed no interest in bidding for Hess as

a whole, it has not ruled out a potential bid for Hess' assets

in Guyana, the company's prize asset.

Exxon operates all production in one of the world's

fastest-growing oil producing nations with a 45% stake in the

giant Stabroek Block. CNOOC owns another 25% of the

joint-venture. Both claim a right of first refusal on any Hess

sale of its 30% stake.

The Chevron ( CVX ) acquisition was thrown into doubt after Exxon

and CNOOC filed an arbitration claim against the sale.

Financial firms Vanguard Group and BlackRock ( BLK ), which

hold a combined 15% of Hess' shares, could tip the balance in

the vote, given the push by arbitrage funds to adjourn the

meeting until the arbitration claim is resolved.

Proxy firm Institutional Shareholder Services recommended

shareholders vote to abstain and urged Hess to offer an

incentive to shareholders because of the deal delay.

As of last week, shareholders owning about 40% of the

combined shares were contemplating abstaining from the vote, an

action that effectively equates to voting against it, people

familiar with the matter said. They say that finalizing the deal

now would prevent the potential for better offers for their

shares throughout the year.