Skip to Main Content

05/30/2024 |

ConocoPhillips to Acquire Marathon Oil in $17.1 Billion All-Stock Deal

This is an image of the ConocoPhilips logo.

Acquisitions Amid Rising Energy Prices

COP (ConocoPhillips) is set to acquire MRO (Marathon Oil) in an all-stock deal valued at approximately $17.1 billion. When including $5.4 billion in debt, the total deal value reaches $22.5 billion. This acquisition comes at a time when crude prices have jumped more than 12% this year, with the cost of a barrel rising above $80 this week. Big oil companies, reaping massive profits since Russia’s invasion of Ukraine in 2022, are now seeing a surge in mergers fueled by their cash-rich status.

Industry Impact and Previous Acquisitions

This acquisition is part of a broader trend of consolidation in the oil industry. CVX (Chevron) announced last year its intention to buy HES (Hess) for $53 billion, though this deal faces significant regulatory challenges. Similarly, XOM (Exxon Mobil) has been active, paying $4.9 billion for Denbury Resources and proposing a $60 billion acquisition of shale operator Pioneer Natural Resources. These proposed mergers could encounter resistance from U.S. antitrust authorities, who have increased their scrutiny under the Biden administration.

Details and Future Plans of the ConocoPhillips-Marathon Oil Deal

As part of the ConocoPhillips transaction, Marathon Oil shareholders will receive 0.2550 shares of ConocoPhillips common stock for each share they own. ConocoPhillips expects the deal to close in the fourth quarter, pending approval from Marathon Oil stockholders. This acquisition will add highly desired acreage to ConocoPhillips’ existing U.S. onshore portfolio, further strengthening its unconventional position. Additionally, ConocoPhillips plans to raise its ordinary dividend by 34% to 78 cents per share and repurchase more than $20 billion in shares over the next three years, contingent on recent commodity prices.