Exxon Mobil Corporation (NYSE: XOM) and Pioneer Natural Resources (NYSE: PXD) have jointly announced a definitive agreement for ExxonMobil to acquire Pioneer in an all-stock transaction valued at $59.5 billion. The deal, which equates to $253 per share based on ExxonMobil’s closing price on October 5, 2023, marks a significant development in the energy industry.
Under the terms of the agreement, Pioneer shareholders will receive 2.3234 shares of ExxonMobil for each Pioneer share at closing, resulting in an implied total enterprise value of approximately $64.5 billion, including net debt. The merger combines Pioneer’s expansive 850,000 net acres in the Midland Basin with ExxonMobil’s 570,000 net acres in the Delaware and Midland Basins, establishing a leading high-quality undeveloped U.S. unconventional inventory position. The combined entity is set to have an estimated 16 billion barrels of oil equivalent resource in the Permian Basin.
ExxonMobil Chairman and CEO, Darren Woods, expressed his optimism about the merger, stating, “Pioneer is a clear leader in the Permian with a unique asset base and people with deep industry knowledge. The combined capabilities of our two companies will provide long-term value creation well in excess of what either company is capable of doing on a standalone basis.”
Pioneer Chief Executive Officer, Scott Sheffield, highlighted the benefits of the merger, stating, “The combination of ExxonMobil and Pioneer creates a diversified energy company with the largest footprint of high-return wells in the Permian Basin. The consolidated company will maintain its leadership position, driving further efficiencies through the combination of our adjacent, contiguous acreage in the Midland Basin and our highly talented employee base, with the improved ability to deliver durable returns, creating tangible value for shareholders for decades to come.”
The transaction is expected to close in the first half of 2024 and is subject to customary regulatory reviews and approvals, as well as approval by Pioneer shareholders.
Advisors: Citi acted as lead financial advisor, Centerview Partners as financial advisor, and Davis Polk & Wardwell as legal advisor to ExxonMobil. Goldman Sachs, Morgan Stanley, Petrie Partners, and Bank of America Securities acted as financial advisors to Pioneer; Gibson, Dunn & Crutcher LLP acted as legal advisor to Pioneer.
Investor Call: ExxonMobil and Pioneer will discuss the proposed merger during a webcast at 11 a.m. Central Time on Wednesday, October 11, 2023. To access the event or review related materials, please visit the ExxonMobil Investor website or the Pioneer investor website.
