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- Major Oil Acquisition
Good Morning!
Happy Wednesday! Let’s see what is moving markets:
👉 Major oil acquisition
👉 Earnings are in
👉FTX exec is sentenced
ACQUISITION: ConocoPhillips
ConocoPhillips has agreed to acquire Marathon Oil in an all-stock deal valued at approximately $17 billion. This continues a trend of significant acquisitions among leading US oil and gas companies. This acquisition broadens ConocoPhillips' presence in domestic shale fields from Texas to North Dakota and includes reserves in Equatorial Guinea.
Source: CNBC
The acquisition offers a 14.7% premium to Marathon's last closing share price and has an enterprise value of $22.5 billion. ConocoPhillips expects the deal to close in the fourth quarter, which will add 2 billion barrels of resources to its inventory. Following the acquisition, ConocoPhillips plans to buy back over $20 billion in shares over the next three years and increase its dividend by 34% to 78 cents per share starting in the fourth quarter.
🎯 GRIT TAKE: The acquisition of Marathon Oil positions…upgrade to VIP now to read the full GRIT Take!
EARNINGS: Abercrombie & Fitch
Abercrombie & Fitch reported its best first quarter ever on Wednesday, continuing to exceed expectations. Sales increased by 22% compared to last year, and profits were nearly seven times higher, beating Wall Street's estimates. The company reported a net income of $113.9 million, or $2.14 per share, up from $16.6 million, or 32 cents per share, a year ago.
Source: Fortune
CEO Fran Horowitz plans to expand the Hollister brand and introduce new categories under Abercrombie. In March, they launched the “A&F Wedding Shop” with items priced between $80 and $150. Abercrombie has shifted to focus on inclusivity and working millennials. This change paid off in 2023 with a 16% sales increase while the U.S. apparel market shrank. The stock rose 285% in 2023 and is up another ~70% this year, beating the S&P 500.
SENTENCED: FTX Executive
Ryan Salame, a former executive at FTX, has been sentenced to seven and a half years in prison, followed by three years of supervised release. He must also pay over $11 million in fines and restitution. This is a harsher sentence than what prosecutors recommended and much longer than the 18 months his defense requested.
Source: NBC
Salame pleaded guilty to making illegal political contributions, defrauding the Federal Election Commission, and operating an unlicensed money-transmitting business. In 2021, Salame moved from Alameda Research to co-CEO of FTX’s Bahamian subsidiary. He spent millions on real estate and political donations. Before FTX's bankruptcy, he warned Bahamian authorities about potential fraud by Sam Bankman-Fried.
Chart of the Day
📊Retirement Savings
Source: Statista
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