Houston, TX-based Schlumberger Ltd (NYSE: SLB) has announced it will purchase Smith International, Inc. (NYSE: SII) in a stock-for-stock transaction.
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Smith International, Inc. is a leading worldwide supplier of premium products and services to the oil and gas exploration and production industry, the petrochemical industry and other industrial markets operating through four business units, M-I SWACO, Smith Technologies, Smith Services and Wilson, its distribution arm.
Smith had sales of $8.2 billion in fiscal year ended Dec. 31, 2009. Profit for the year was $148.2 million.
Under the terms of the agreement, Smith shareholders will receive 0.6966 shares of Schlumberger in exchange for each Smith share. The agreement places a value of $45.84 per Smith share, representing a 37.5% premium, for a transaction value of $11.34 billion.
The transaction is subject to various conditions including Smith stockholder approval and customary regulatory approvals, including the expiration of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The closing of the transaction is planned for the second half of 2010.