$1B is a shitload of "synergies." I've heard ~$300M of that will be G&A cuts (sic, layoffs). Doing some back of the envelope math, $300M divided by an average total comp burden of like $150-200k works out to like 1,500-2,000 jobs. He-l, even if it's $300k that's 1,000 jobs. DVN listed ~2,200 employees on their annual report and CTRA listed ~1,100, for a total of roughly 3,300. They can potentially hit that $300M target if the layoffs are 1,650 bodies, but that's half the current workforce.
Is that even feasible? How overworked will everyone be? Or do they plan to outsource jobs to contractors and overseas?
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Price's Law (often called the square root rule). It states that 50% of the work in any organization is done by the square root of the total number of employees.
So really we are majorly overstaffed and so is just about every other company.
So if Devon cuts the fat and only the fat the Devon at the end of the trim will be glorious.
@hp what about Mar-sell-us? XEC got hosed by COG with that acreage.
Ton of d-mb takes here. Clearly either trolls or people completely ignorant to the process. Yes they didn’t cut enough VP+ that will be remedied within 6 months. They will not get to 300 million from labor. 150-200 at best. And neither company is “over staffed” every single person I work with is over subscribed and working nights and weekends. Not to mention, one of us is bringing on wells and operating them 20% cheaper and the same or better productivity.
@aa Not only they did not cut VPs, but they also promoted and elevated more managers along the way. You know when management is not cut as expected, who will be on the chopping block to account for the numbers
Anyone at Coterra that thinks severance is coming easily in Midland is kidding themselves. They will get creative. Don’t want to move? Not a problem, you can work in Midland. Or remote! Maybe they will surprise us and gut the office but it feels like Permian will stay intact for a while.
@aa They've always been overstaffed . . . it's a "good ole boy" system there with mostly locals and OU frat buddies. For comparison, Diamondback is the same size as Devon and has approximately 1750 employees comapred to the new Devon of approx 3100.
@cv trust me Coterra employees aren’t crying. We are getting paid on this exit and unlike Devon employees we live in Houston where you can find the same job for more money in the same day. 1.5 year of salary in severance plus stock acceleration and never hit the unemployment line. Have fun Devon “just cut the checks” is all you hear in Houston offices.
We can also accomplish the 1B reduction by dropping rigs so less capital is spent.
We might be over staffed, but we are not the ones moving. Keep crying legacy Coterra.
@a2 Serious question- is DVN still a $60B company if they sell off proven reserves?
They didn’t seem to cut much at the VP level.
DVN is overstaffed. Not hard to cut half of them and maintain the same level of output.
It’ll be through basin divestitures. The question is, which one will be first to go?!