Diamondback and Endeavor in talks to form US$50bil energy giant

Midland (Texas): Diamondback Energy Inc and Endeavor Energy Resources are in final discussions toward a deal that would create an oil-and-gas giant worth more than US$50bil, people with knowledge of the matter says.

Closely held Endeavor would be valued at around US$25bil in the stock-and-cash deal, which may be announced as soon this week, said the people, who asked not to be identified because the talks aren’t public.

Diamondback has a market capitalisation of US$27.2bil. The Wall Street Journal reported on the discussions earlier last Sunday.

Representatives for Diamondback and Endeavor, both based in Midland, Texas, didn’t immediately respond to requests for comment from Bloomberg.

The United States is the world’s biggest oil producer, in large part due to frenetic drilling in the Permian Basin of Texas and New Mexico.

Oil is in high demand despite efforts to transition away, with consumption expected to rise through 2030 – and perhaps beyond.

A combination of Diamondback and Endeavor would be the latest in a string of major mergers that has reshaped the corporate landscape in US shale oil recently.

In the previous 12 months, Exxon Mobil Corp agreed to acquire Pioneer Resources for about US$60bil, Chevron Corp agreed to buy Hess Corp for about US$53bil, and Occidental Petroleum Corp reached an accord to purchase CrownRock LP for about US$10.8bil. — Bloomberg

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