Takeover target Caltex Australia will fork out $165 million to rebrand itself as Ampol following the breakdown of a licensing agreement with US oil giant Chevron.

The ASX-listed company announced on Monday it be revitalising the 83-year-old petrol company following Chevron's termination of a longstanding agreement for Caltex Australia to use its 'Caltex' brand, which it owns and licenses to operators around the world.

Caltex is set to become Ampol after licensing negotiations with former shareholder Chevron failed. Credit:Sasha Woolley

The name change comes at a tumultuous time for the local fuel and service station giant, which is currently waiting on a fresh takeover offer from Canadian convenience store operator Couche-Tard after Caltex Australia said its initial $8.6 billion bid was "undervalued".

It's also in the midst of a $1.1 billion spin-off of a 50 per cent stake in 250 of its service stations across the country, with plans to create an ASX-listed property trust.