Phillips-Conoco Merger Close To Formal Approval

Phillips Petroleum and Conoco won conditional approval from U.S. antitrust authorities on Friday for their $15.3 billion merger. The companies would have to divest some assets in the midwest U.S. as was expected under the proposed consent decree adopted by the Federal Trade Commission. The deal won approval from shareholders in March. "Especially noteworthy is our action in the Rocky Mountain region where divestitures will maintain competition in the gasoline refining market," Joe Simons, head of the FTC's competition bureau, said in a statement. Executives have billed the deal as a merger of equals, but Phillips shareholders would own about 56.6 percent of the new company, and Conoco shareholders would own about 43.4 percent. The board of the new company, to be called, would be equally divided between executives from the two firms.

The companies will have to sell Phillips' refinery in Woods Cross, Utah and related marketing assets; Conoco's refinery in Commerce City, Colorado and Phillips' marketing assets in eastern Colorado. Phillips' will also have to sell its light petroleum products terminal in Spokane, Washington, its propane terminal assets in Jefferson City, Missouri, and East St. Louis, Illinois as well as offer a long-term propane supply agreement, according to the FTC. Conoco will also have to sell some of its natural gas gathering assets in three counties in New Mexico as well as a processing facility and other assets in one county in Texas, the antitrust authority said.

Conoco shareholders would get 0.4677 shares of the new company for each Conoco share they own. Phillips stockholders would swap each of their shares for one share in ConocoPhillips.