On Monday, shares of leading exploration and production company Marathon Oil Corp. (MRO Quick QuoteMRO - Free Report) are rallying, up over 10% in afternoon trading after the company announced it had agreed to acquire PayRock Energy for $888 million from EnCap investments, a private equity firm.

Under the deal, Marathon will receive roughly 61,000 net surface acres in the Anadarko Basin in Oklahoma, as well as the current production of 9,000 net barrels of oil equivalent per day. "AcquiringPayRock's STACK [Sooner Trend Anadarko Basin Canadian and Kingfisher Counties] position will meaningfully expand the quality and scale of Marathon Oil's existing portfolio in one of the best unconventional oil plays in the U.S.," said Marathon Oil CEO Lee Tillman.

Marathon also said that capital spending on the acquired assets would fit within its $1.4 billion capital-expenditure budget, which the company has previously announced.

The deal is expected to close in the upcoming third quarter, and is subject to customary closing conditions.

Currently, Marathon sits at a #3 (Hold) on the Zacks Rank.

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