3.5 C
New York
Wednesday, February 21, 2024

Diamondback Deal Forges New Permian Giant

Diamondback Deal Forges New Permian Giant

Diamondback Energy (CROC) agreed Monday to buy privately held Endeavor Energy Resources for $26 billion, including debt, creating a new Permian shale giant and the latest in a wave of recent big energy deals. FANG stock rose slightly.


Diamondback will pay 117.3 million FANG shares and $8 billion in cash for Endeavor, founded by wildcat Autry Stephens. Existing Diamondback holders will own 60.5% of the combined company.

The agreement confirms reports on Sunday that a deal had been reached.

Diamondback Energy reportedly fended off other Endeavor suitors, including ConocoPhillips (COP).

Diamondback increased its annual dividend by 7%, to $3.60 per share. But it will reduce its capital repayment commitment to 50% of free cash flow from the first quarter, down from 75% previously.

Other energy offers

Last October, Exxon Mobile (XOM) agreed to buy the Permian shale giant Pioneering natural resources (PXD) for $59.5 billion in an all-stock transaction. Including debt, Exxon-Pioneer agreement was $64.5 billion. Later that month, the Dow giant Chevron (CLC) announced a $53 billion deal For Hesse (HE IS), which has significant reserves in Guyana.

In other recent transactions, Western oil (OXY) late last year agreed to buy privately held CrownRock for $10.8 billion. APA Corp. (WHAT)in January, it struck a $4.5 billion buyout deal with a smaller rival. Callon Petroleum (CPE).

Diamondback Action

Diamondback Energy stock rose 1.6% early Monday.

Shares rose 1% last week to 151.74, but closed below their 50-day moving average on Friday. FANG stock has a buy point of 171.40 during a consolidation dating back to October 2023, but has been moving sideways since mid-2022.

Please follow Ed Carson on the discussions at @edcarson1971 and X/Twitter on @IBD_ECarson for stock market updates and more.


Why this MII tool simplifies To inputch For the best actions

Want to get quick profits and avoid big losses? Try SwingTrader

Best Growth Stocks to Buy and Watch

IBD Digital: Unlock IBD’s premium stock lists, tools and analysis today

Tesla cuts Model Y prices for a limited time – at least for now

Futures: increased market risks; Five new purchases

Source link

Latest stories