Exxon to buy Pioneer Natural in $60 bn deal with energy prices surging

Exxon Mobil is buying Pioneer Natural Resources in an all-stock deal valued at USD 59.5 billion, its largest buyout since acquiring Mobil two decades ago, creating a colossal fracking operator in West Texas.

The transaction’s value, including debt, is about USD 64.5 billion.

Pioneer shareholders will receive 2.3234 shares of Exxon Mobil for each Pioneer share they own.

Exxon purchased XTO Energy in 2009 for approximately USD 36 billion. In the late 1990s, the merger between Exxon and Mobil totalled more than USD 80 billion.

The deal with Pioneer Natural gives Exxon Mobil more access to the Permian basin, which runs through parts of Texas and New Mexico.

Exxon has been flush with cash. The company posted record annual profits in 2022, bringing in USD 55.7 billion in annual profits, exceeding its previous record of USD 45.22 billion in 2008.

Exxon has been using some of that cash on acquisitions. In July the company announced that it was buying pipeline operator Denbury in an all-stock deal valued at USD 4.9 billion.

Pioneer Natural has been making similar moves. In 2020 the company said it was buying Parsley Energy in an all-stock deal valued at approximately USD 4.5 billion. It then purchased DoublePoint Energy in a cash-and-stock deal worth about USD 6.4 billion in 2021.

Both companies’ boards have approved the transaction, which is expected to close in the first half of next year. It still needs approval from Pioneer shareholders.