Indiana Grain Company, LLC

Posted: 02/21/10

By: tomgrisafi

The worlds largest oilfield services company, Schlumberger Ltd., has reached a deal to purchase Smith International for $11.3 Billion in an all stock transaction.

“Smith’s drilling techniques, other products and expertise complement our own, while the geographical footprint of Schlumberger means we can extend our joint offerings worldwide,” Schlumberger Chief Executive Officer Andrew Gould said in a statement.

This is the largest oilfield-services acquisition ever, and the overall largest merger the U.S has seen this year. Philip Weiss an analyst with Argus research in New York says "takeover of Smith could prompt antitrust regulators to force asset sales to prevent Schlumberger from having too much market share in certain categories.

Weiss also added, "When I look at the fact that Smith has a relatively weak balance sheet and a relatively narrow product offering, I can see why it would be better for Smith in the long run to be acquired.”

The deal is expected to close in the later half of this year.

Source:Bloomberg