ConocoPhillips Completes Concho Acquisition; Tim Leach Joins Leadership

ConocoPhillips Co. completed its acquisition of Concho Resources, one of the largest independent producers in the Permian Basin, following approval by shareholders of both companies, ConocoPhillips said in a Jan. 15 release.

The all-stock transaction, which was valued at about $13.3 billion when it was announced in late October, was the biggest deal of 2020. The agreement was comprised of the exchange of 1.46 shares of ConocoPhillips for each Concho share.

The Concho acquisition gives ConocoPhillips about 700,000 net acres in the Permian Basin—more than quadruple the size of its previous position in the Permian—which the Houston-based company expects to be a cornerstone in its global portfolio.

“This acquisition results in the combination of two premier companies that can lead the structural change for our vital industry that’s critical to investors,” Ryan Lance, chairman and CEO of ConocoPhillips, said in a statement on Jan. 15. “We expect the company to deliver differential performance on three key mandates: providing affordable energy to the world, generating superior returns on and of capital and demonstrating ESG leadership.”

Lance also welcomed Tim Leach to the ConocoPhillips’ board of directors and executive leadership team. Upon closing of the transaction, Leach, previously Concho’s chairman and CEO, agreed to join ConocoPhillips as executive vice president of the company’s Lower 48 operations. 

“Tim and his organization built a best-in-class Permian company and we both look forward to creating significant value from this transaction,” Lance continued in his statement. “Thanks to the considerable efforts of our transition teams over these past few months, we’re off to a fast start toward seamlessly integrating our two companies and building momentum as a sector leader.”

Based in Midland, Texas, Concho Resources was one of the largest unconventional shale producers in the Permian Basin, with positions in both the Delaware and Midland sub-basins, and the fifth-largest producer by volume in the basin. The company’s total production for the second quarter was 319,000 boe/d.

Including its now “core-of-the-core” acreage position in the Permian Basin, ConocoPhillips also has positions in the Eagle Ford and Bakken in the Lower 48 and the Montney in Canada. Pro forma, the company said it will produce over 1.5 million boe/d across its global portfolio.

Goldman Sachs & Co. LLC was exclusive financial adviser to ConocoPhillips for the transaction, and Wachtell, Lipton, Rosen & Katz served as its legal adviser. Credit Suisse Securities (USA) LLC and J.P. Morgan Securities LLC were financial advisers to Concho. Sullivan & Cromwell LLP was legal adviser to Concho.