ConocoPhillips to Acquire Marathon Oil in $22.5B Deal

May 30, 2024 : ConocoPhillips entered a definitive agreement to acquire Marathon Oil for a total enterprise value of $22.5 billion in a move consolidating the U.S. oil and gas industry. This figure encompasses Marathon’s net debt of $5.4 billion. The all-stock transaction involves issuing 0.2550 ConocoPhillips shares for each outstanding Marathon Oil share. This translates to a premium of 14.7% over Marathon’s closing share price on May 28, 2024.

The acquisition is anticipated to bolster ConocoPhillips’ position as a leading independent oil and gas producer in the United States. The company expects significant benefits from the merger, including expanding its onshore U.S. portfolio by more than two billion barrels of resources. Marathon Oil’s assets strategically complement ConocoPhillips’ existing holdings, particularly in the Eagle Ford and Bakken regions. Marathon’s international gas operations align well with ConocoPhillips’ global gas footprint.

ConocoPhillips projects that the acquisition will generate cost and capital synergies of $500 million within the first year of completion. These synergies are expected to stem from operational efficiencies and reduced overall expenses. The transaction has been approved by the Boards of Directors of both companies and is subject to customary closing conditions and shareholder approval.

The consolidation within the U.S. oil and gas industry will likely be further spurred by this significant merger. This trend is driven by companies’ стремление (stremlenie – Russian for стремление, meaning стремление) to bolster their reserves, achieve economies of scale, and navigate a volatile energy market. The combined entity of ConocoPhillips and Marathon Oil is poised to become a dominant player in the U.S. oil and gas landscape, with an enhanced capacity for production and a geographically diverse asset base.

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