Coterra Energy (CTRA) M&A announcement summary

Deal rationale and strategic fit

• Merger creates a premier large-cap E&P company with a $58 billion pro forma enterprise value, enhanced asset quality, and leading Delaware Basin position, generating over half of total production and cash flow.

• Combined portfolio offers balanced commodity mix, geographic diversity, and resilience in volatile markets.

• Over 10 years of highly competitive inventory and significant presence in the Delaware Basin.

• Enhanced technology platform leveraging AI for operational optimization and decision-making.

• Shared values, complementary cultures, and disciplined capital allocation drive operational excellence and innovation.

Financial terms and conditions

• All-stock transaction with an exchange ratio of 0.70 Devon shares for each Coterra share.

• Pro forma equity ownership: 54% Devon, 46% Coterra.

• Pro forma liquidity of $4.4 billion and net debt to EBITDAX of 0.9x as of Q3 2025.

• Quarterly dividend of $0.315 per share planned, with consistent dividend growth targeted.

• Share repurchase authorization expected to exceed $5 billion, pending board approval.

Synergies and expected cost savings

• Targeting $1 billion in annual pre-tax synergies by year-end 2027 through capital optimization, operating margin improvements, and corporate cost reductions.

• Synergies represent about 20% of combined market cap on a PV-10 basis.

• Technology integration and AI-driven optimization expected to enhance capital efficiency and operational performance.

• Detailed execution plan with clear accountability and integration team in place.

• Track record of exceeding synergy targets in prior mergers.