Chesapeake Energy and Southwestern Energy, two of the largest natural gas producers in the United States, announced plans to merge on Thursday, in an all-stock deal worth $7.4 billion. The new company would become one of the largest energy producers in the United States, with a significant presence in Louisiana and Texas.
Combined, the two companies would have a market value of about $24 billion, challenging rivals like Chevron and EQT. By Thursday afternoon, Chesapeake’s share price was up more than 5 percent.
The deal is the latest in a series of mergers and acquisitions involving U.S. oil and natural gas companies. In October, Chevron announced plans to acquire Hess in a $53 billion deal. Two weeks earlier, Exxon Mobil struck a $60 billion deal to buy Pioneer Natural Resources, a major producer in the Permian Basin in Texas.
“Bringing Chesapeake and Southwestern together will reduce overall costs,” Peter McNally, an energy analyst at the research firm Third Bridge, wrote in a note, but there is “little likelihood of these companies influencing the price of natural gas, which is increasingly becoming a global market.”
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