Diamondback Energy and Endeavor Energy in Advanced Talks for Potential Merger
According to sources close to the matter, shale rivals Diamondback Energy Inc. and Endeavor Energy Resources are said to be in late-stage discussions regarding a potential merger. The Wall Street Journal reports that the deal could be finalized as early as Monday.
Insiders reveal that the proposed cash-and-stock agreement would value privately held Endeavor at approximately $25 billion. As part of the deal, stockholders of Diamondback Energy would become the majority owners of the newly combined entity.
This potential merger would potentially outshine ConocoPhillips, who was also in contention to acquire Endeavor. Diamondback Energy, based in Midland, Texas, currently holds a market capitalization of $27.3 billion, as per FactSet. In comparison, ConocoPhillips has a market cap of $133 billion.
If successful, this deal would continue the string of major consolidations within the energy sector. Just last month, Chevron Corp. acquired Hess Corp. for $53 billion in an all-stock transaction. This was followed by Exxon Mobil Corp.’s $59.5 billion acquisition of Pioneer Natural Resources Co.
In October, Southwestern Energy Co. and Chesapeake Energy Corp. agreed to merge in a deal valued at $7.4 billion, creating a natural gas powerhouse.
As of now, there has been no official statement from Diamondback Energy or Endeavor regarding the potential merger.
MarketWatch has reached out to Diamondback and Endeavor for comment.
Note: The above article is a rewritten version of the original text, modified to adhere to the journalistic writing style and optimized for search engine optimization (SEO) purposes.
Analyst comment
Positive news for Diamondback Energy and Endeavor Energy as they are in advanced talks for a potential merger. If the deal is finalized, Diamondback Energy would become the majority owner of the combined entity and the merger would continue the trend of major consolidations in the energy sector.
