Economics
Concho CEO Sees RSP Deal as `Road Map' for Consolidating Permian
- All-share deal will create one of shale’s largest producers
- Including debt, acquisition will be valued at $9.5 billion
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Concho Resources Inc.’s chief executive trumpeted his $8 billion acquisition in the Permian shale basin as a “road map" for consolidation in America’s hottest drilling play, even as investors took a warier look at the pricetag.
The buyout of rival RSP Permian Inc. in an all-stock deal would create the basin’s biggest producer, at a time when the industry is moving toward ever-larger, more complex operations to supersize the shale boom. Despite the hefty premium attached to the deal, Concho CEO Tim Leach said he saw no drop-off in interest for other acquirers in the region.