The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

By Robert Cyran

NEW YORK, Feb 2 (Reuters Breakingviews) - Devon’s all-share purchase of fellow shale driller Coterra promises to unleash savings worth maybe $8 bln. Most of that value is going back to shareholders, rather than into new extraction. It’s a sign that the dramatic transformation of American energy is peaking at last.

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CONTEXT NEWS

U.S. shale oil producers Devon Energy and Coterra Energy said on February 2 that they had agreed to merge in an all-stock deal valued at approximately $58 billion including debt.

Coterra shareholders will receive 0.7 shares of Devon for each share they own. Upon completion of the deal, Devon shareholders will own approximately 54% of the combined company.

Devon said it plans to increase its dividend by 31% to 31.5 cents per quarter, and initiate a new share repurchase agreement exceeding $5 billion, following the close of the deal.

Evercore served as financial advisor to Devon. Goldman Sachs advised Coterra.

(Editing by Jonathan Guilford; Production by Pranav Kiran)

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