Exxon Mobil Nears $60 Billion Pioneer Acquisition Amid FTC Investigation
Exxon Mobil Corp. (XOM) is on the verge of finalizing its $60 billion acquisition of Pioneer Natural Resources Co. (PXD). The deal, expected to close in the coming days, comes after Exxon agreed to exclude Pioneer CEO Scott Sheffield from its board of directors. However, the transaction is overshadowed by an ongoing Federal Trade Commission (FTC) investigation into Sheffield's alleged involvement in collusive activities that may have impacted oil prices.
The FTC's investigation centers around hundreds of messages reportedly sent by Sheffield to representatives of the Organization of the Petroleum Exporting Countries (OPEC) regarding oil pricing and production levels. These communications have raised concerns about potential collusion, which could have artificially inflated oil prices. While Exxon Mobil itself has not been accused of any wrongdoing, the investigation casts a shadow over the impending acquisition.
The news of the FTC investigation sent ripples through the energy sector, with both Exxon Mobil and Pioneer Natural Resources experiencing stock price declines on Wednesday. Exxon Mobil shares closed down 1.89% at $116.03, while Pioneer Natural Resources shares closed down 0.65% at $267.66.
The outcome of the FTC investigation remains uncertain, but it could have significant implications for both companies. If Sheffield is found to have engaged in illegal activities, it could lead to hefty fines and potentially derail the acquisition. Additionally, the investigation could damage the reputation of both companies and erode investor confidence.
As the investigation unfolds, market participants will be closely monitoring developments to assess the potential impact on the $60 billion deal and the broader energy sector.