FINDLAY, Ohio – Marathon Petroleum Corp. has agreed to purchase all of Andeavor’s outstanding shares for $23.3 billion, making Marathon the largest independent refiner in the U.S. The combination of Marathon’s operations in the Midwest and Gulf Coast and Andeavor’s concentration in the western U.S. will generate about 16% of the nation’s refining capacity.

When the transaction closes in the second half of this year, Marathon and Andeavor shareholders will own approximately 66% and 34% of the combined company, respectively. During early trading talks, Marathon shares sank at most 8.9% while Andeavor’s rose as much as 18%.

Including Andeavor’s debt, Marathon is paying $35.6 billion to hold two-thirds of a combined company worth $58 billion. The offer values Andeavor at about $152.27 a share, representing a 24% premium over the sale day’s closing price.

The transaction comes at a time when oil-prices are surging and global demands are growing. The U.S. is the world’s top fuel exporter, shipping more than three billion barrels per day of gasoline and diesel.

“We expect this transaction will be meaningfully accretive for shareholders, generating approximately $1 billion of tangible annual run-rate synergies within the first three years and significantly enhancing our long-term cash flow generation profile," said Gary R. Heminger, chairman and CEO of Marathon. "Given the confidence in the robust cash flow expected to be generated by the combined business, our board also authorized an incremental $5 billion of share repurchases."

Experts say the purchase gives Marathon a leg up in the fast-growing production boom, as well as in Mexican fuel markets. There’s no question the new company has greater resource capability going forward into Mexico,” said Gregory Goff, Andeavor CEO.