U.S. shale producers Devon Energy and Coterra Energy announced today that they have signed a definitive agreement to merge in an all-stock deal valued at $58 billion, forming a large-cap producer with a strong presence in the Delaware Basin.
The merged entity will be named Devon Energy, headquartered in Houston, and will also hold a significant presence in Oklahoma City. Shareholders will receive 0.70 Devon shares for each of their shares. Devon will hold approximately 54% of the combined company.
In a statement, Clay Gaspar, Devon’s President and CEO, told investors, “This transformative merger combines two companies with proud histories and cultures of operational excellence, creating a premier shale operator. We’ve now built a diverse asset base of high-quality, long duration inventory to drive resilient value creation and returns for shareholders through cycles. Underpinned by our leading position in the best part of the Delaware Basin, and a deep set of complementary assets, we expect to capture annual pre-tax synergies of $1 billion. This will drive higher free cash flow and greater shareholder returns beyond what either company could achieve alone.”
Tom Jorden, Chairman, CEO, and President of Coterra, said, “This combination enhances the Delaware and brings together two premier organizations with complementary cultures rooted in operational excellence, disciplined capital allocation, and data-driven decision-making focused on creating per share value. The combined company will offer best-in-class rock quality and inventory depth, supported by a balanced commodity mix, leading cost structure, and a conservative balance sheet. Devon Energy will be strongly positioned to deliver top-tier capital efficiency gains and consistent profitable per share growth through the commodity cycles.”
Following the merger, the board will consist of 11 members: six representing Devon and five representing Coterra. Clay Gaspar will serve as President and CEO, while Tom Jorden will assume the role of Non-Executive Chairman.
The CEO and senior management will be headquartered in Houston, with leadership team members coming from both Devon and Coterra.
By CEO NA Editorial Staff
