Diamondback Energy (NASDAQ:FANG) and closely held Endeavor Energy Resources are close to an agreement that would combine two Permian Basin rivals and create a company valued at more than $50 billion.
The stock-and-cash transaction would value Endeavor at around $25 billion, and Diamondback (FANG) shareholders would own the majority of the combined entity after the deal closes, the WSJ reported. Diamondback has a market cap of about $27 billion.
A potential Diamondback Energy, Endeavor tie-up after Reuters reported in December that Endeavor was evaluating a sale that would value the largest privately-held oil and gas producer in the Permian basin at $25 billion to $30 billion.
Endeavor has evaluated offers in the past, including in 2018, Reuters reported in the past. There has been outreach from multiple interested parties in recent times, which has spurred the privately-held company to consider a sale at this time.
A Endeavor/Diamondback (FANG) deal follows a flurry of M&A activity in the Permian Basin, including Occidental’s (OXY) announced $12 billlion purchase of CrownRock in December and Exxon Mobil’s (XOM) planned $59.5 billion acquistion of Pioneer Natural Resoruces, which was announced in October.