The recent announcement of the Oxy-APC merger agreement has sparked a great deal of interest and speculation within the energy industry. If you are not yet familiar with the details surrounding this merger, this article will provide you with all of the important information.

Oxy (Occidental Petroleum Corporation) is a leading energy producer with a strong presence in the US oil and gas market. APC (Anadarko Petroleum Corporation) is a similar company with significant assets in oil and gas production across the globe. The merger will result in the formation of a new entity, which will have the resources and capabilities to compete more effectively in the global energy market.

As per the agreement, Oxy will acquire APC in a deal worth $57 billion. This marks the largest acquisition in the energy sector since ExxonMobil acquired XTO Energy back in 2009. Oxy is set to pay APC shareholders a combination of cash and stock, and will assume the company`s debt. The transaction is expected to close during the second half of 2019, subject to regulatory approvals.

The rationale behind this merger is quite clear – the two companies complement each other well in terms of assets and capabilities. APC brings a significant amount of shale assets in the US to the table, which will provide Oxy with much-needed leverage in this area. In addition, APC also has a strong presence in the LNG market, which will further diversify Oxy`s portfolio.

From a financial perspective, the benefits of this merger are significant. The combined entity will have an estimated value of $100 billion, making it the ninth largest energy company in the world. There will be significant synergies to be realized from the merger, with an estimated $3.5 billion in annual cost savings expected to be achieved by 2021.

It is worth noting that this merger is not without its challenges. There has been some opposition from APC shareholders, who believe that the price being offered is too low. In addition, there is the risk of regulatory hurdles, as the combined entity may face antitrust scrutiny due to its size and scope.

In conclusion, the Oxy-APC merger agreement is a major development in the energy sector, with implications for both companies and the wider market. It is a significant step towards consolidation and increased competitiveness, in a market that is constantly evolving and changing. The coming months will be crucial in determining the ultimate success of this merger, but there is no doubt that it will have a major impact on the energy industry for years to come.