Big Oil keeps doing big deals.
ConocoPhillips said Wednesday it had agreed to buy Marathon Oil in an all-stock deal worth $22.5 billion, including about $5.4 billion of debt.
Marathon Oil shareholders will receive 0.255 ConocoPhillips shares for each Marathon share they own, representing a 14.7% premium to the closing price on Tuesday.
The merger of the Houston-based rivals follows ExxonMobil’s $60 billion purchase of Pioneer and Chevron’s agreed takeover of Hess for $53 billion. The wave of consolidation has also included Occidental buying CrownRock and Diamondback Energy acquiring Endeavor Energy Partners in multibillion-dollar cash-and-stock deals.
Oil giants are flush with cash and printing bumper profits following years of elevated prices. They’re using those windfalls to snap up assets in the Permian basin — the oil field that has helped make the US the world’s top producer of oil and gas — and boost returns for shareholders even as pressure builds for them to invest more in renewable energy.
“This acquisition of Marathon Oil further deepens our portfolio and fits within our financial framework, adding high-quality, low cost of supply inventory” Ryan Lance, ConocoPhillips CEO, said in a statement.
The Financial Times reported earlier Wednesday that a deal was close and that Conoco and Devon Energy had been vying for weeks to acquire Marathon.
This is a developing story and will be updated.
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