Diamondback, Endeavor Energy Reportedly in Final Talks for Merger Deal

Diamondback Energy Inc. and Endeavor Energy Resources are reportedly close to sealing their merger deal. The companies are already in the final stage of negotiations for an agreement that will form a $50 billion oil and gas giant.

Diamondback Energy and Endeavor Energy have been rivals in the exploration and production sector, and now, according to sources familiar with the matter, they are about to merge. Bloomberg reported that the latter would be valued at about $25 billion in a stock and cash arrangement, while the former has a market cap of $27.2 billion.

Expected Deal Announcement

People who asked not to be identified as the negotiations were not made public added that Endeavor and Diamondback Energy may formally announce their deal as soon as Monday, Feb. 12. Once the merger is fully finalized, it would make the Midland, Texas-headquartered one of the most prominent names in the energy sector.

The acquisition, which could be announced as soon as Monday, would transform Midland-based Diamondback into one of the biggest players in the expansive Permian Basin of Texas and New Mexico, the biggest oilfield in the United States. Due to the active drilling in this basin, the U.S. is currently the biggest oil producer in the world.

Successful Acquisition Bid

While Diamondback is already working on final adjustments for the deal, the Financial Times reported that the company had to compete with companies to buy Endeavor Energy. It competed with and eventually defeated Conoco, which has a market cap of about $132 billion.

This is a big win for Diamondback Energy, as it lost out to Occidental Petroleum in its bid to acquire CrownRock last year. Warren Buffet-backed Occidental struck a deal with CrownRock worth $12 billion.

Photo by: Diamondback Energy Newsroom