Conoco buys Concho Resources for $9.7 bln
ConocoPhillips has struck a deal with Concho Resources to tie up their operations in a $9.7-billion all-stock deal.
Cathy Bussewitz reported the news for the AP:
ConocoPhillips is buying shale producer Concho Resources in an all-stock deal valued at $9.7 billion, making it a major presence in the Permian Basin, the top-producing oil field in the U.S.
The combined company, if approved, would be among the largest U.S. oil producers, with production of more than 1.5 million barrels of oil equivalent per day, a resource base of approximately 23 billion barrels of oil and an enterprise value of about $60 billion.
Reuters’ Arunima Kumar wrote:
The deal swaps 1.46 shares of ConocoPhillips for each Concho share, at a premium of about 1.5% over its Friday price. Shares in Concho and ConocoPhillips on Monday fell amid a market selloff, with Concho off 2.8% at $47.26 and ConocoPhillips down 3.2% to $32.70. Concho had sold for as much as $93 a share in January before the COVID-19 pandemic cut oil demand and prices.
Rebecca Elliott from the Wall Street Journal reported:
“Sector consolidation is both necessary and inevitable,” ConocoPhillips Chief Executive Ryan Lance told analysts Monday after the announcement. “We both believe our industry needs solutions that address the lack of scale, poor returns and, increasingly, the challenges and opportunities of environmental, social and governance matters.”