The proposed merger of Phillips Petroleum Co. and Conoco Inc. got a big thumbs up Monday on Wall Street, where talk of more oil industry deals is already circulating.
Shares of Phillips (ticker symbol: P) rose $1.53 to $53.35, and shares of Conoco (COC) climbed $1.68 to $25.98. Before the merger plans were announced Monday, Phillips shares were down 9% year-to-date and Conoco's were off 16%.
The all-stock deal isn't priced to provide a premium for shareholders. But the shares rose after the companies said their merger would save at least $750 million a year as well as create the biggest refiner and third-biggest oil company in the U.S.
The merger might put more pressure on USX-Marathon Group (MRO), the current No. 3 U.S. oil company, to sell itself, said Philip Dodge, an analyst at Ryan, Beck & Co.
