US oil companies Houston-based Talos Energy and Stone Energy of Lafayette, Louisiana, are moving toward a $2.5bn merger, according to Reuters.
Both firms have significant involvement in Gulf of Mexico projects. The valuation includes debt.
Talos specializes in exploration, development and production of oil and natural gas properties in the Gulf and on the US Gulf coast.
Stone Energy has projects in the Gulf but also has some onshore interests in the Appalachian Basin.
A statement from the companies said that under the deal Stone Energy shares will be exchanged for Talos shares one-for-one and Talos’ shareholders will be issued 34.2 million new shares so that they will have a 63% stake in the merged firm.
The new entity will be named Talos Energy.