Courtesy of reuters.com

Schlumberger Ltd will buy equipment maker Cameron International Corp for $14.8 billion, as the world's top oilfield services firm scrambles to offer a broader range of products at lower prices to oil companies slashing budgets.

The deal, which values Cameron around the market cap it had when oil prices were still $100 a barrel, marks the second big merger among energy services companies since crude prices LCOc1 entered a 60 percent slide last year.

Schlumberger said the acquisition will allow it to bundle its offerings, which range from surveying a site to drilling wells, with ones from Cameron that include pressure valves and blowout preventers, one of which was at BP's Macondo well that exploded in 2010.

The two companies know each other well. They set up a joint venture, OneSubsea, to target the deepwater industry in 2012.

They have been eyeing each other since then, a person familiar with the deal told Reuters who spoke on the condition of anonymity, noting that Schlumberger has a history of acquiring its partners.

"The deal should allow a more complete solution to customers and should allow SLB to grow market share," said BMO Capital Markets analyst Daniel Boyd. "Smaller companies offering discrete products and services will likely be at a disadvantage going forward."

Schlumberger said the combined company would have pro-forma revenue of $59 billion in 2014. That is 20 percent more than Schlumberger's revenue for 2014 and compares with $57.42 billion generated together by Halliburton Co and Baker Hughes Inc.

Cameron's shares were up about 41 percent at $60, below Schlumberger's $66.36 per share cash-and-stock offer, in afternoon trading on Wednesday. Schlumberger's shares fell as much as 7.5 percent to $68.01, their lowest in two-and-a-half years.

Source: reuters.com