Diamondback Energy Will Buy Permian Rival Endeavor For $26 Billion

Diamondback Energy (FANG) on agreed to buy privately held Endeavor Energy Resources on Monday for $26 billion including debt, creating a new Permian Shale giant and the latest in a flurry of big recent energy deals. FANG stock jumped.


Diamondback will pay 117.3 million FANG shares and $8 billion cash for Endeavor, founded by wildcatter Autry Stephens. Existing Diamondback holders will own 60.5% of the combined company.

The agreement confirms Sunday reports that a deal was close.

Diamondback Energy reportedly fended off other Endeavor suitors, including ConocoPhillips (COP).

Diamondback hiked its annual dividend by 7% to $3.60 a share. But it’ll reduce its return of capital commitment to 50% of free cash flow starting in Q1, vs. 75% previously.

Other Energy Deals

Last October, Exxon Mobil (XOM) agreed to buy Permian Shale giant Pioneer Natural Resources (PXD) for $59.5 billion in an all-stock deal. Including debt, the Exxon-Pioneer deal was $64.5 billion. Later that month, Dow giant Chevron (CVX) announced a $53 billion deal for Hess (HES), which has significant reserves in Guyana.

In other recent deals, Occidental Petroleum (OXY) late last year agreed to buy privately held CrownRock for $10.8 billion. APA Corp. (APA)in January sealed a $4.5 billion takeover agreement with smaller rival Callon Petroleum (CPE).

Diamondback Stock

Diamondback Energy stock leapt 10% to 166.90 early Monday, vaulting above its 50-day line as well as a trendline entry and various short-term highs.

FANG stock has a 171.40 buy point in a consolidation going back to October 2023, but has been moving sideways since mid-2022.

Shares rose 1% last week to 151.74.

Please follow Ed Carson on  Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.


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