Energy giant Exxon Mobil (NYSE:XOM) has agreed to acquire independent energy company Denbury Inc. (NYSE:DEN) at $89.45 per share. The all-stock deal pegs the total consideration for the expert in carbon capture, utilization, and storage (CCS) and oil recovery at $4.9 billion.
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Under the deal, Denbury investors will get 0.84 Exxon shares for each Denbury share held by them. The strategic move is a step towards growing Exxon’s Low carbon Solutions business. With this acquisition, Exxon gets the biggest owned and operated network of carbon dioxide pipelines in the U.S. alongside 10 onshore sequestration sites.
Further, synergies from the deal are expected to result in emissions reductions of over 100 million metric tons a year. The acquisition has received the blessings of the Boards of both companies and is anticipated to close in the fourth quarter of this year.
At the time of writing, Exxon and Denbury shares were trending lower by 1.7% and 0.8% respectively
Overall, the Street has a $127.43 consensus price target on Exxon alongside a Moderate Buy consensus rating. Shares of the company have ticked 24% higher over the past 52 weeks.
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