DEN - ExxonMobil Is in No Hurry to Spend Its $32.7 Billion Cash War Chest
2023-05-09 08:32:00 ET
ExxonMobil (NYSE: XOM) is swimming in cash these days. During the first quarter, the oil giant generated $16.3 billion in cash. Even after spending billions on capital projects and sending billions more back to shareholders via dividends and repurchases, Exxon's cash balance ballooned by another $3 billion to $32.7 billion.
That enormous cash war chest has many wondering if Exxon plans to make a big acquisition. While the company is open to making a deal, -- and there have been plenty of rumors in recent months -- it was clear from management's comments on the first-quarter earnings call that Exxon plans to be patient. Here's a look at the rumor mill and what Exxon's management said about the potential for making a deal.
There has been a lot of speculation that ExxonMobil has set its sights on making a meaningful acquisition. Last fall, several media outlets reported that Exxon had held preliminary talks to acquire Denbury Resources (NYSE: DEN) . The deal would have been for more than $5 billion, given Denbury's market cap at the time. While Denbury Resources produces oil, the main draw would have been its carbon dioxide business. Denbury is a leader in using the greenhouse gas to produce oil through enhanced oil recovery. Because It could have bolstered ExxonMobil's carbon capture and sequestration platform, which it believes could be a needle-mover in the future .
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ExxonMobil Is in No Hurry to Spend Its $32.7 Billion Cash War Chest