ConocoPhillips COP recently completed the acquisition of Marathon Oil Corporation, which was initially announced in May, 2024. The acquisition will enhance its deep, durable and diverse portfolio aligned with its strict financial framework. It will bolster COP’s high-quality inventory at low cost alongside its prominent U.S. unconventional assets.
Financial Details of COP’s Acquisition
Per the terms of the acquisition deal, the shareholders of Marathon Oil would have the right to receive 0.255 shares of COP common stock for each Marathon Oil share they held at the effective time of the merger. Cash would also be paid out in lieu of any fractional shares held by them.
The company, which has a strong track record of integrating assets, is expected to generate over $1 billion in synergies in the next 12 months through its strategic acquisition of Marathon Oil.
What’s Next for Marathon Oil?
With the closure of the acquisition, Marathon Oil has now become a wholly owned subsidiary of ConocoPhillips and ceases to be a publicly traded company. COP plans to streamline Marathon Oil's reporting obligations by filing Form 15 with the SEC, which will terminate Marathon’s registration under the Exchange Act and it will not be required to file any further reports with the SEC.
COP’s Zacks Rank and Key Picks
Headquartered in Houston, TX, ConocoPhillips is primarily involved in the exploration and production of oil and natural gas. Currently, COP has a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked stocks like Mach Natural Resources LP MNR, TechnipFMC plc FTI and Targa Resources Corp. TRGP. Currently, Mach Natural Resources, TechnipFMC and Targa Resources each carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mach Natural Resources LP is an independent upstream oil and gas company that focuses on the acquisition, development and production of oil, natural gas and natural gas liquids reserves. The Zacks Consensus Estimate for MNR’s 2024 earnings indicates 200% year-over-year growth.
London-based TechnipFMC plc is a leading manufacturer and supplier of products, services and fully integrated technology solutions for the energy industry. The Zacks Consensus Estimate for FTI’s 2024 earnings indicates 246.67% year-over-year growth.
Houston, TX-based Targa Resources Corp. is a premier energy infrastructure company and a leading provider of integrated midstream services in North America. The Zacks Consensus Estimate for TRGP’s 2024 earnings indicates 70.22% year-over-year growth.
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