Devon Energy and Coterra Energy to merge in $58bn all-stock deal

Devon Energy and Coterra Energy person agreed to merge done an all-stock transaction, creating a large entity successful the US shale manufacture with an estimated combined endeavor worth of $58bn.

The caller entity, which volition run nether the sanction Devon Energy, volition beryllium headquartered successful Houston, Texas, portion maintaining a important beingness successful Oklahoma City.

With a beardown operational basal successful the Delaware Basin, the enlarged Devon Energy aims to leverage halfway strengths and attain $1bn successful yearly pre-tax synergies.

The Boards of Directors of the 2 companies unanimously approved the merger, which is expected to beryllium finalised successful the 2nd 4th of 2026, pending regulatory and shareholder approvals.

Under the statement terms, Coterra Energy shareholders volition person 0.7 shares of Devon Energy communal banal for each of their shares. This volition effect successful Devon Energy shareholders owning astir 54% and Coterra Energy shareholders astir 46% of the caller institution connected a afloat diluted basis.

Efforts to execute synergies volition absorption connected enhanced superior efficiency, optimised superior allocation and exertion integration, driving per-share maturation successful escaped currency travel and nett plus value.

Devon Energy president and CEO Clay Gaspar said: “This transformative merger combines 2 companies with arrogant histories and cultures of operational excellence, creating a premier shale operator. We person present built a divers plus basal of high-quality, long-duration inventory to thrust resilient worth instauration and returns for shareholders done cycles.

“Underpinned by our starring presumption successful the champion portion of the Delaware Basin, and a heavy acceptable of complementary assets, we expect to seizure yearly pre-tax synergies of $1bn. This volition thrust higher escaped currency travel and greater shareholder returns beyond what either institution could execute alone.”

The combined accumulation portfolio volition diagnostic much than 1.6 cardinal barrels of lipid equivalent per day, anchored by high-quality acreage successful the Delaware Basin.

The merger is acceptable to heighten Devon Energy's presumption arsenic 1 of the largest producers successful this region, with important operations crossed astir 750,000 nett acres.

Financially, the merger is structured to fortify investment-grade presumption and trim aboriginal superior costs.

Post-merger governance volition spot Gaspar proceed arsenic president and CEO, with Coterra Energy’s president and CEO, Tom Jorden, stepping into the relation of non-executive chairman.

The committee volition comprise 11 members, divided betwixt six directors from Devon Energy and 5 from Coterra Energy.

Financial advisory enactment for Devon Energy is being provided by Evercore, with ineligible counsel from Skadden, Arps, Slate, Meagher & Flom.