ConocoPhillips Inks $17B Deal for Marathon Oil
HOUSTON — ConocoPhillips will buy Marathon Oil Corp. in a nearly $17 billion, all-stock transaction, the companies announced May 29. The deal has an enterprise value of $22.5 billion, inclusive of $5.4 billion of net debt.
Marathon Oil shareholders will receive 0.2550 shares of ConocoPhillips common stock for each share of Marathon Oil common stock, representing a 14.7% premium to the closing share price of Marathon Oil on May 28, 2024, and a 16% premium to the prior 10-day volume-weighted average price.
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"This acquisition of Marathon Oil further deepens our portfolio and fits within our financial framework, adding high-quality, low cost of supply inventory adjacent to our leading U.S. unconventional position," said Ryan Lance, ConocoPhillips chairman and CEO. "Importantly, we share similar values and cultures with a focus on operating safely and responsibly to create long-term value for our shareholders. The transaction is immediately accretive to earnings, cash flows and distributions per share, and we see significant synergy potential."
According to the companies, the transaction:
- Is immediately accretive to ConocoPhillips on earnings, cash from operations, free cash flow and return of capital per share to shareholders;
- Delivers significant cost and capital synergies; and
- Further enhances ConocoPhillips' existing U.S. onshore portfolio.
"This is a proud moment to look back on what we achieved at Marathon Oil," said Lee Tillman, Marathon Oil chairman, president and CEO. "Powered by our dedicated employees and contractors, we built a top performing portfolio with a multi-year track record of peer-leading operational execution, strong financial results and compelling return of capital to our shareholders — all while holding true to our core values of safety and environmental excellence.
"ConocoPhillips is the right home to build on that legacy, offering a truly unique combination of added scale, resilience and long-term durability," Tillman continued. "With its premier global asset base, strong balance sheet and laser focus on operational excellence, ConocoPhillips' track record of long-term investments, differentiated shareholder distributions and active portfolio management are unmatched. When combined with the global ConocoPhillips portfolio, I'm confident our assets and people will deliver significant shareholder value over the long term."
The acquisition is subject to the approval of Marathon Oil stockholders, regulatory clearance and other customary closing conditions. It is expected to close in the fourth quarter of 2024.
Houston-based Marathon Oil is an independent oil and gas exploration and production company.
Also headquartered in Houston, ConocoPhillips is one of the world's leading exploration and production companies with operations and activities in 13 countries.