Davis Polk is advising oil and gas giant ExxonMobil on its acquisition of rival Pioneer Natural Resources in an all-stock transaction valued at $59.5bn. 

Pioneer is being advised by Gibson Dunn & Crutcher. 

The acquisition is the largest globally so far this year and Exxon’s biggest since its $75.3bn acquisition of Mobil back in 1999. Valued at $253 per share, it will see Exxon become the largest producer in the Permian Basin, the biggest oilfield in the US. 

The Davis Polk corporate team includes partners Louis Goldberg, Oliver Smith and Shanu Bajaj and associates Heather Weigel and Edwin Paillant. Partner David Schnabel and associate Constance Zhang are providing tax advice. Partner Jennifer Conway and counsel Charlotte Fabiani and Joseph Brown are providing executive compensation advice. All members of the Davis Polk team are based in the New York office.

Meantime the Gibson Dunn corporate team is led by partners Jeffrey Chapman and Tull Florey and includes partners Andrew Kaplan and Michael Darden and associates Phillip Sanders, Jonathan Sapp, Jordan Rex, Benjamin Lefler, William Altabef, Alexis Levine and Graham Valenta. Partners Darius Mehraban and Doug Horowitz and of counsel Adam Lapidus are advising on financing. Partners Michael Cannon and Eric Sloan, of counsel Jennifer Sabin and associates Josiah Bethards and Duncan Hamilton are advising on tax aspects, while partner Krista Hanvey and associate Gina Hancock are advising on benefits. Partners Stephen Weissman, Chris Wilson and Sophia Hansell and associates Zoë Hutchinson and Steve Pet are advising on antitrust aspects.

Irving, Texas-based Pioneer is one of the most successful names to have come out of the US shale revolution, which saw the country rapidly become the biggest oil producer in the world. News of the company’s acquisition by Exxon follows the latter agreeing to a $4.9bn all-stock deal for oil producer Denbury earlier this year, with Davis Polk called in to advise Exxon on the deal. 

For its part, Exxon has pulled out of a period of heavy losses in the past two years through a combination of cost-cutting, asset selling and reaping the benefits of high energy prices as a result of Russia’s invasion of Ukraine. The company earned a record $56bn profit last year, a historic high for the western oil industry, and recently saw its stock reach an all-time high of $120 per share. 

Citi acted as lead financial advisor and Centerview Partners as financial advisor to ExxonMobil on the Pioneer acquisition. Goldman Sachs, Morgan Stanley, Petrie Partners and Bank of America Securities acted as financial advisors to Pioneer. 

The deal is expected to close in early 2024.