Exxon Mobil
announced on Thursday that it will acquire carbon capture developer
Denbury
in an all stock deal valued at $4.9 billion.
Buying
Denbury
(ticker: DEN) provides
Exxon
(XOM) with the largest owned and operated carbon dioxide pipeline network in the U.S., Exxon said in the news release.
“Acquiring Denbury reflects our determination to profitably grow our Low Carbon Solutions business by serving a range of hard-to-decarbonize industries with a comprehensive carbon capture and sequestration offering,” Darren Woods, chief executive of Exxon, said in the release.
The boards of directors for both companies have unanimously approved the acquisition, which, subject to regulatory approval, is expected to close in the fourth quarter of this year.
If the deal is completed, Denbury investors will receive 0.84 Exxon shares for each Denbury share they own.
“Given the significant capital and years of work required to fully develop our CO2 business, ExxonMobil is the ideal partner with extensive resources and capabilities,” Denbury Chief Executive Chris Kendall said. “The all-equity consideration will allow Denbury shareholders to participate in the upside of ExxonMobil’s stock while benefitting from its strong capital return strategy.”
Shares of Exxon were flat in premarket trading to $106.50. Denbury stock was up 0.6% to $88.24.
Write to Angela Palumbo at [email protected]
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