Shale drillers Cabot and Cimarex baffle analysts with $7.4billion merger

Shale drillers Cabot and Cimarex baffle analysts with $7.4billion merger

The merger of Cabot Oil & Gas Corp. with Cimarex Energy Co. announced Monday has confounded investors and analysts, leaving them to question the logic behind a tie-up that the companies say will increase diversification.

Shale investors have been demanding more consolidation in the U.S. oil patch. But not exactly a deal like this one.

Cimarex is mostly an oil explorer in Texas and Oklahoma, while Cabot is focused on natural gas drilling in the Marcellus shale basin in Appalachia.