USX to split off Marathon Oil

Petroleum News Alaska

USX Corp. said April 24 that it will separate its energy and steel businesses, USX-Marathon Group and USX-U.S. Steel Group. USX said the reorganization is expected to be implemented at year end as a tax-free spin-off.

The USX steel businesses will to be known as United States Steel Corp. Holders of current USX-U. S. Steel Group common stock would become holders of United States Steel Corp. common stock.

Holders of current USX-Marathon Group common stock would become holders of Marathon Oil Co. common stock.

Each new company would carry approximately its current assets and liabilities, except approximately $900 million of corporate debt would be transferred to Marathon.

Marathon is expected to have an investment grade rating at the current USX level or higher and U.S. Steel is expected to have a slightly below investment grade rating.

Thomas Usher, chairman and chief executive officer of USX, will become chairman and chief executive officer of U.S. Steel. He will become chairman of Marathon Oil Co.

Clarence P. Cazalot Jr. will become president and chief executive officer of Marathon Oil.

The plan of reorganization is subject to the approval of a majority of the outstanding shares of each class of the current USX common stock at a special meeting of shareholders early in the fourth quarter of this year and is also subject to receipt of a favorable tax ruling from the Internal Revenue Service on the tax-free nature of the transaction.