Marathon Petroleum Corp. and Andeavor plan to merge with Marathon buying all of Andeavor's outstanding shares, representing a total equity value of $23.3 billion based on Marathon's April 27 closing price of $81.43.

The deal was approved by the board of directors of both companies and is expected to close in the second half of 2018. The headquarters will be in Findlay, Ohio, and the combined business will maintain an office in San Antonio, Texas.

Andeavor's retail-marketing system includes more than 3,200 stores marketed under multiple brands, including Arco, SuperAmerica, Shell, Exxon, Mobil, Tesoro, USA Gasoline and Giant. Andeavor operates 10 refineries with a combined capacity of approximately 1.2 million barrels per day.

Marrathon is the nation's second-largest refiner, with a crude oil refining capacity of approximately 1.9 million barrels per day in its six-refinery system. Marathon brand gasoline is sold through 5,600 retail outlets across 20 states and the District of Columbia.

In addition, Speedway LLC, a subsidiary, owns and operates a convenience store chain, with some 2,740 stores in 21 states.

Map showing locations of Andeavor refineries. Credit: AndeavorMarathon owns, leases or has ownership interests in approximately 10,800 miles of crude oil and light product pipelines. It also has ownership interests in gathering and processing facilities with approximately 5.9 billion cubic feet per day of gathering capacity, 8.4 billion cubic feet per day of natural gas processing capacity and 610,000 barrels per day of fractionation capacity.

The Energy Department's Energy Information Administration said in July 2017 that U.S. operable atmospheric crude refining capacity stood at 18.6 million barrels per calendar day, 1.6 percent higher than at the beginning of 2016.

The combination is intended to create a leading U.S. refining, marketing and midstream company, says Gary R. Heminger, Marathon's chairman and CEO. After the merger, the company is expected to rank as the largest refiner by capacity in the U.S.

Andeavor operates refineries in California, the Mid-Continent, and the Pacific Northwest, while Marathon operates refineries along the Gulf Coast and in the Midwest. The combined company will have throughput capacity of over three million barrels per day.

The merged company will have a presence in the Permian, Bakken and Marcellus basins, and is expected to increase Marathon's midstream growth opportunities.