Pioneer's CEO cheers Exxon's 'great dividend.' Here's how much he could make.

By Tomi Kilgore

Pioneer's Sheffield tells CNBC he'll keep the Exxon Mobil shares he receives as part of the all-stock merger deal

'No. Definitely I'm going to keep it. They have a great dividend, one of the highest in the S&P 500, so I'm very excited about that.'Scott Sheffield, according to a transcript provided by CNBC.

That's Pioneer Natural Resources Co. co-Founder and Chief Executive Scott Sheffield, responding to a question from CNBC about whether he would keep the Exxon Mobil Corp. shares he receives as part of the merger agreement announced Wednesday or sell them.

"Definitely I'm going to keep it," he said. "They have a great dividend, one of the highest in the S&P 500, so I'm very excited about that."

Under the terms of the $59.5 billion all-stock buyout agreement, each Pioneer share (PXD) will be exchanged for 2.3234 Exxon Mobil shares (XOM).

In Sheffield's latest Form 4 filing with the Securities and Exchange Commission in February, he disclosed that he directly and indirectly owned a total of 596,917 Pioneer shares, which represents about 0.3% of the total shares outstanding.

That puts Sheffield in line to receive about 1.39 million Exxon shares.

Exxon's last quarterly dividend of 91 cents a share was paid on Sept. 11 implies an annual dividend rate of $3.64 a share. Based on current stock prices, the implied dividend yield is 3.45%, which places as having the 127th-highest dividend yield among S&P 500 index's SPX members.

In comparison, the dividend yield for the Energy Select Sector SPDR ETF was 3.48% and the implied yield for the S&P 500 was 1.60%.

So the 1.39 million Exxon shares Sheffield is in line to receive would pay out a yearly dividend of about $5.05 million.

Meanwhile, Pioneer declared in August a quarterly dividend payment of $1.84 a share, comprised of a base dividend of $1.25 a share plus a variable dividend of 59 cents. At current stock prices, the implied annual dividend rate implies at a dividend yield of 3.07%.

Sheffield said in the CNBC interview that he is still planning to retire at the end of this year, but will be a director after the deal closes.

Exxon's stock was down 4.5% in midday trading, while Pioneer shares gained 1.1%.

-Tomi Kilgore

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10-11-23 1222ET

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