Oil giant ConocoPhillips will acquire Marathon Oil Corporation in an all-stock transaction for $22.5 billion, inclusive of $5.4 billion of net debt, both companies announced on Wednesday.
The Houston-based companies announced that Marathon Oil shareholders will receive a 14.7% premium in ConocoPhillips stock.
ConocoPhillips expects to achieve the full $500 million of cost savings within the first full year following the closing of the transaction, which is expected to be in the fourth quarter of this year.
This deal adds over 2 billion barrels of resources to ConocoPhillips’ existing US onshore portfolio.
Commenting on the merger, Ryan Lance, ConocoPhillips’ chairman and chief executive officer, said: “This acquisition of Marathon Oil further deepens our portfolio and fits within our financial framework, adding high-quality, low-cost supply inventory adjacent to our leading US unconventional position.”
“The transaction is immediately accretive to earnings, cash flows, and distributions per share, and we see significant synergy potential,” he added.
For his part, Lee Tillman, Marathon Oil chairman, president and chief executive officer, said: “When combined with the global ConocoPhillips portfolio, I’m confident our assets and people will deliver significant shareholder value over the long term.”
By Handan Kazanci
Anadolu Agency
energy@aa.com.tr