BOSTON & HOUSTON–Baker Hughes has officially announced that the companies have entered into an agreement to combine GE’s oil and gas business and Baker Hughes to create a world-leading oilfield technology provider with a unique mix of service and equipment capabilities. The “New” Baker Hughes will be a leading equipment, technology and services provider in the oil and gas industry with $32 billion of combined revenue1 and operations in more than 120 countries. By drawing from GE technology expertise and Baker Hughes capabilities in oilfield services, the new company will provide best-in-class physical and digital technology solutions for customer productivity.
Under the terms of the agreement, which has been unanimously approved by the boards of directors of both companies, at the closing of the transaction Baker Hughes shareholders will receive a special one-time cash dividend of $17.50 per share and 37.5% of the new company. GE will own 62.5% of the company. The transaction is expected to close in mid 2017.
Facts:
- Highly complementary transaction combines GE’s oil and gas technology, manufacturing and digital platform with Baker Hughes’ oilfield services offerings and technologies
- Combination creates an unparalleled company positioned to deliver value for customers and investors
- GE to own 62.5% and Baker Hughes shareholders to own 37.5% of the “New” Baker Hughes
- GE to contribute $7.4 billion to fund the $17.50 per share special dividend to existing Baker Hughes shareholders
- Expected to be accretive to GE 2018 earnings per share by approximately $.04; Synergies of $1.6 billion expected to be realized by 2020
- Lorenzo Simonelli will be CEO, Jeff Immelt will be Chairman and Martin Craighead will be Vice Chairman of the “New” Baker Hughes Board of Directors