NEW YORK, September 28, 2015 /PRNewswire/ --
ACI Association has initiated research coverage on
Schlumberger Limited (NYSE: SLB). Select highlights from the
internally released reports are being made available to the general
public (included below), with access to the entirety of the
research available to new members.
Today, membership is open to readers on a complementary basis at
the following URL: http://www.aciassociation.com/SLB.pdf
Highlights from our SLB Report include:
- Acquisition of Cameron - On August
26, 2015, the world's leading supplier of technology,
integrated project management and information solutions
Schlumberger Limited announced the acquisition of its smaller
rival, Cameron International Corp., in a cash and stock
transaction. The transaction would enable the combination of two
complementary technology portfolios into a "pore-to-pipeline"
products and services offering to the global oil and gas industry.
Schlumberger informed that the combined entity generated revenue of
$59 billion in 2014, on a pro-forma
basis.
- Terms of the Transaction - Under
the terms of agreement, Cameron
shareholders will receive 0.716 shares of Schlumberger common stock
along with $14.44 in cash in exchange
for each Cameron share. Based on
the closing stock prices of both companies as on August 25, 2015, the transaction would be valued
at 66.36 per Cameron share. This
represents a 37.0% premium to Cameron's 20-day volume weighted average price
of $48.45 per share, and a 56.3%
premium to Cameron's closing stock
price of $42.47 per share on the
prior to the announcement. Schlumberger said that Cameron shareholders will own approximately
10% of Schlumberger's outstanding shares of common stock upon
closing of the transaction. The transaction, which is subjected to
regulatory approvals, is expected to be closed in Q1 2016.
- Synergies from the Acquisition - According
to the release, the initial synergy benefits arising out of the
acquisition would include a reduction in operating costs,
streamlined supply chains and improvement in manufacturing process.
Revenue synergies are expected to start flowing in second year and
in the following years. Further, the Company anticipates pretax
synergies of approximately $300
million and $600 million in
the first and second year, respectively, and the combination is
expected to be accretive to earnings per share by the end of the
first year after closing.
- Management's Views - The
Chairman and CEO of Schlumberger, Paal
Kibsgaard commented, "This agreement with Cameron opens new and broader opportunities
for Schlumberger." He added, "We believe that the next industry
technical breakthrough will be achieved through integration of
Schlumberger's reservoir and well technologies with Cameron's leadership in surface, drilling,
processing and flow control technologies. Deep reservoir knowledge
further enabled by instrumentation, software and automation, will
launch a new era of complete drilling and production system
performance."
To find out how this influences our rating on Schlumberger
Limited, read the full report in its entirety here:
http://www.aciassociation.com/SLB.pdf
--
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