An $8 bln merger wrings out oilfields’ last drops

ChampionX

02/04/2024 18:21

(The author is a Reuters Breakingviews columnist. The opinions
expressed are his own.)
    By Robert Cyran
       NEW YORK, April 2 (Reuters Breakingviews) - The oil
industry has refocused on returning cash in lieu of expansion,
leaving a meaner market for companies that help to drill wells.
SLB’s purchase of ChampionX is a smart way to hold ground,
especially since only half of promised benefits need materialize
to square the math.
    Full view will be published shortly.
    Follow @rob_cyran on X
         
    CONTEXT NEWS 
    Oilfield services company SLB said on April 2 it had agreed
to buy rival ChampionX in an all-stock deal valued at nearly
$7.8 billion using closing prices on April 1. ChampionX
shareholders would own about 9% of the combined company.
    Under the agreement, the seller’s shareholders will receive
0.35 shares of SLB for each share of ChampionX. The price
represents a 15% premium to where ChampionX shares closed on
April 1.
    ChampionX provides chemicals used in oil and gas production,
and artificial lift technologies to increase production from
wells. Almost two-thirds of the company’s revenue in 2023 came
from the United States and Canada. 

 (Editing by Jonathan Guilford and Sharon Lam)
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