Exxon Mobil Waiting Period over for XTO Energy
A required regulatory hurdle entailing a waiting period for Exxon Mobil (NYSE:XOM) to take over XTO Energy (NYSE:XTO) has been met, and the fact that there were no objections or actions taken by the Federal Trade Commission or the Justice Department implies an open door and that Exxon and XTO can go forward with the deal. The waiting period officially ended on Monday.
Terms of the deal are straightforward, with Exxon acquiring XTO in an all-stock deal for the company. One other key requirement will be for the shareholders to approve the deal, which doesn't seem to be a problem at this time. Exxon will also take over about $10 billion in debt XTO holds. The deal is expected to close on June 30 according to CEO Rex Tillerson.
According to XTO, they are sitting on 45 trillion cubic feet of gas which is trapped in tight shale formations, which formerly was cost-prohibitive to extract. New technology exists where it can be done on a much less expensive basis.
Exxon believes natural gas will be an important generator of electricity in the years ahead.
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