REUTERS: U.S. oil and gas producer Devon Energy Corp said on Monday it will buy Permian basin peer WPX Energy Inc for US$2.56 billion as it looks to scale up its presence in the Delaware portion of the prolific shale field.
Deals at little or no premium are becoming the norm in the oil and gas industry as producers seek out combinations to tide out a coronavirus-induced slump in demand and a crash in prices of hydrocarbons. Devon said the deal, which is expected to close in the first quarter of 2021, will help cut costs and improve its annual cash flow by US$575 million by end of next year.Tudor, Pickering and Holt analysts said the deal creates material scale in the Delaware while significantly cutting costs.
It will own 57per cent of the combined company, which will have an enterprise value of around US$12 billion..
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