Marathon’s $23 bn deal to buy Andeavor will make it largest US refiner

Marathon Petroleum Corp  (HQ in Findlay pictured) has agreed to buy rival Andeavor for $23 billion to become the largest American oil refiner, reports say. Currently, Valero Energy Corp is the biggest in oil refining capacity, generating about 16% of the nation’s total. The deal is likely to close in the second half of this year. Marathon does not anticipate any regulatory hurdles since they are complimentary companies with Marathon focused in the East and Andeavor in the West. Over the past five years, oil demand has been surging and refining is now one of the lucrative sectors in the US. Both companies have access to large supplies at discount prices. Greg Goff, chief executive of Andeavor who will become executive vice chairman of the combined company, justified the deal saying the wind is behind their backs. Marathon chairman and chief executive officer Gary Heminger expects annual cost and operating synergies of about $1 billion in three years. The two refiners will be major gainers amid a surge in demand for fuels such as gasoline and diesel. Marathon’s gasoline is sold in 20 states.