** Exxon Mobil XOM.N on Wednesday agreed to buy U.S. rival Pioneer Natural Resources PXD.N in an all-stock deal valued at $59.5 billion that would make it the biggest producer in the largest U.S. oilfield Permian Basin
** XOM falls 3.3% to $106.8 and PXD up 1.1% at $239.9 in morning trading
PERMIAN M&A ACTIVITY BOOST
** Major players in the Permian Basin are likely to step up to try to compete with XOM, driving up valuations for the high-quality companies, says Siebert's equity research managing director
** Adds, any small-and-medium (SMID) capped exploration and production firms unable to grow through acquisition would ultimately have to sell out, such as Chevron buying PDC Energy
** Piper Sandler analysts also see "increasing investor focus on future potential consolidation activity, from SMID-caps up to and including like OXY, BP and COP"
** RBC Capital Market's analyst Scott Harnold says while FTC review of the $60 billion deal is likely, market share of deal appears to be under thresholds typically warranting action
** J.P.Morgan analysts say it's a strategic move, growing XOM's Permian footprint that had been smaller than that of peers CVX and COP
(Reporting by Arunima Kumar, Sourasis Bose, and Seher Dareen in Bengaluru)
((Seher.Dareen@thomsonreuters.com; If in India call +91 74832 70128, if within U.S. call +1 646 223 8780;))