Oklahoma City, Okla. — Devon Energy announced a $58 billion merger with Houston-based Coterra Energy, marking a significant shift for the Oklahoma City-based company.
The merger is expected to save $1 billion annually, with the combined entity retaining the Devon Energy name but relocating its headquarters to Houston.
Steve Agee, dean emeritus of economics at Oklahoma City University, noted that up to 50 executives might move to Houston.
Agee said, “I think this is going to turn out just fine, and Devon is certainly not going to abandon Oklahoma City.”
Agee said Devon Energy has undergone many company mergers and acquisitions in the last three decades that catapulted it into an energy giant worth $20 billion.
Some companies include: The Kerr-McGee Corporation in 1996 purchased for $250 million. NorthStar Energy for $750 million, and Anderson Production for $4.6 billion.
Mayor David Holt acknowledged the uncertainty surrounding Devon’s future presence in Oklahoma City but praised the company’s historical impact.
In a statement to Fox 25, Holt said, “‘There are still major unknowns regarding the scale of Devon’s future presence in OKC, but to the extent that today is an inflection point in the company’s history, we certainly pay tribute to all that Devon Energy has done for OKC. Economically and philanthropically, the impact is immeasurable. There isn’t a company in our city’s history that has meant more to Oklahoma City’s progress.
Our community can’t control the global economy and the inevitable mergers and acquisitions that result. We have seen many of these through the years; we’ve won some, we’ve lost some. What we can control is that we can build a city with a high quality of life and economic diversification strong enough to withstand adversity. We have worked hard as a city to establish a local economy that is not reliant on any single industry, much less one single company.
As an example of this, right now is unquestionably the greatest period in our city’s history, and yet that current success stands upon a local history that is littered with the names of companies that no longer exist. Our economy is dynamic, and the fundamentals of our city are strong. Throughout our modern history, we have proven our ability to overcome, and to the extent such resilience might be necessary in this situation, we will demonstrate it once again.”
The merger, pending shareholder approval, is expected to close later this year.
While the short-term impact may be negative, Agee believes it will adjust over time.
Company leaders have not said whether the tower will remain fully occupied or if space could eventually be vacated.
Devon Energy has not disclosed potential job losses resulting from the merger.
