Exxon Mobil (XOM) -) said Thursday it would buy carbon capture specialists Denbury Inc. (DEN) -) in an all-stock deal that values the Plano, Texas-based group at around $4.9 billion.
Exxon said it would pay $89.45 per share for Denbury, a 2% premium to the group's Wednesday closing price, with investors receiving 0.84 shares of Exxon for each stock holding. The deal is likely to close in the fourth quarter of this year, Exxon said.
Denbury, Exxon said, owns the largest CO2 pipeline network in the United States, measuring some 1,3000 miles, with most of it in the biggest CO2 markets of Texas, Louisiana and Mississippi.
“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,” said CEO Darren Woods.
“The breadth of Denbury’s network, when added to ExxonMobil’s decades of experience and capabilities in CCS, gives us the opportunity to play an even greater role in a thoughtful energy transition, as we continue to deliver on our commitment to provide the world with the vital energy and products it needs,” he added.
Exxon shares were marked 1.67% lower in early Thursday trading following news of the deal to change hands at $104.70 each, while Denbury shares fell 0.9% to $86.94 each.
Earlier this year, Exxon Mobil posted record first quarter profits, despite a pullback in crude prices, thanks in part to a ramp-up in production and ongoing cost cuts.
Exxon's net income nearly doubled from last year, to $11.43 billion, a first quarter record, and the company said it remains on track to cut costs by around $9 billion, compared to 2023 levels, by the end of the year.
