Suit hits Halliburton-Baker Hughes merger

Halliburton Co. and Baker Hughes Inc. intend to “vigorously contest” a lawsuit filed Apr. 6 by the US Department of Justice that seeks to block their proposed merger (OGJ Online, July 13, 2015).

In a joint statement, the companies said they’ll show the department “underestimated the highly competitive nature of the oil-field services industry, the many benefits of the proposed combination, and the sufficiency of the divestitures” Halliburton has proposed to address questions about competitive effects.

DOJ said its lawsuit alleges Halliburton’s proposed takeover of Baker Hughes, valued at $34 billion when announced in November 2014, “threatens to eliminate competition, raise prices, and reduce innovation in the oil-field services industry (OGJ Online, Nov. 17, 2014).”

The complaint, according to a department statement, says proposed divestitures “would not include full business units but rather would be limited to certain assets, with the merged firm holding onto important facilities, employees, contracts, intellectual property, and research and development resources that would put the buyer of those assets at a competitive disadvantage.”

It says Halliburton would be able to retain valuable assets of both companies while selling “less significant assets.”

And it alleges “this divestiture would not replicate the substantial competition between the two rivals that exists today.”

Did You Like this Article? Get All the Energy Industry News Delivered to Your Inbox

Subscribe to an email newsletter today at no cost and receive the latest news and information.

 Subscribe Now

Whitepapers

The Time is Right for Optimum Reliability: Capital-Intensive Industries and Asset Performance Management

Imagine a plant that is no longer at risk of a random shutdown. Imagine not worrying about losing...

Going Digital: The New Normal in Oil & Gas

In this whitepaper you will learn how Keystone Engineering, ONGC, and Saipem are using software t...

Maximizing Operational Excellence

In a recent survey conducted by PennEnergy Research, 70% of surveyed energy industry professional...

Leveraging the Power of Information in the Energy Industry

Information Governance is about more than compliance. It’s about using your information to drive ...