Devon Energy and Coterra Energy announced a definitive agreement to merge in an all-stock deal, a move the companies say will reshape their scale, assets and shareholder returns.
Devon Energy and Coterra Energy say the all-stock merger will strengthen their Delaware Basin footprint and drive long-term per-share growth.
Here’s what the deal means, broken down.
When is the merger expected to happen?
The companies expect the transaction to close in the second quarter of 2026. The merger has already been unanimously approved by both boards of directors and is still subject to regulatory review and shareholder approvals.
Why is the merger happening?
Devon and Coterra say the merger is designed to create a stronger, more competitive shale producer by combining high-quality assets and technical capabilities.
The companies expect the deal to generate $1 billion in annual pre-tax synergies, improve capital efficiency and drive both near and long-term per-share growth. What are pre-tax synergies? The estimated, non-tax-adjusted cost savings, including layoffs and consolidation of systems, in addition to increased revenue realized by merging two companies
What will happen to Devon Energy in Oklahoma City?
The combined company will keep the Devon Energy name and be headquartered in Houston, while maintaining a significant presence in Oklahoma City. The companies have not announced plans to relocate or close Devon’s Oklahoma City operations.
Are any layoffs or job losses expected?
The companies did not announce any layoffs or job cuts as part of the merger announcement. No workforce reductions were detailed in the transaction materials released Monday.
What will happen to stockholders?
Coterra shareholders will receive 0.70 share of Devon common stock for each share of Coterra stock they own. After the merger closes, Devon shareholders are expected to own about 54% of the combined company, while Coterra shareholders will own about 46% on a fully diluted basis.
The company also plans to declare a quarterly dividend of $0.315 per share and establish a new share repurchase authorization exceeding $5 billion, both subject to board approval.
Who will lead the combined company?
Devon President and CEO Clay Gaspar will serve as president and CEO of the combined company. Coterra Chairman, CEO and President Tom Jorden will become non-executive chairman of the board. The board will include 11 members, with six from Devon and five from Coterra, and executive leadership will be based in Houston.
The companies say the merger will create one of the world’s largest shale producers, with more than half of production and cash flow expected to come from the Delaware Basin.
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Key Takeaways
- Devon Energy and Coterra Energy to complete merger in mid-2026.
- Devon Energy headquarters will move to Houston, but “significant presence” will remain in OKC.
- Job loss impacts are unknown, both companies could announce additional details later on.
