Oilfield services giant Weatherford International Ltd. (WFT), in an attempt to streamline its international operations, has announced the divestiture of its land drilling and workover assets in Russia and Venezuela. These would be acquired by Rosneft. An agreement was signed between Rosneft president Igor Sechin and vice president of Weatherford for Russia, Lance Marklinger, in this regard.
Per the agreement, the divestiture will include eight companies, which are part of the Weatherford group, involved in drilling operations in Russia and Venezuela. The agreement also includes plans for the development of long-term cooperation in oil field services between the two companies. The transaction is expected to close in the third quarter of 2014.
In June, Weatherford relocated its legal domicile to Ireland from Switzerland. The approval was passed at an Extraordinary General Meeting of Shareholders at which over 98% of the shareholders voted in favor of the proposal. The incorporation under the Irish law will strengthen Weatherford’s activities and facilitate operations at the lowest possible cost. It will also boost the company’s ability to rapidly and efficiently progress on its transformational path. The move will enable the company to retain and further attract the finest personnel in the industry.
The company’s strategy emphasizes on the expansion of its core businesses and selling of its non-core assets. Weatherford’s future success rests on the successful execution of its planned divestitures. The company would conduct its annual general meeting in Sep 2014, as an Irish entity.
Weatherford is a leading oilfield services company. It manufactures and provides equipment and services used in drilling, completion, and production of oil and natural gas wells. The company’s operations are divided into four separate regions: North America, Latin America, Europe/West Africa/CIS, and the Middle East/North Africa/Asia. It has manufacturing facilities and sales, service and distribution locations throughout the world.
Weatherford currently carries a Zacks Rank #3 (Hold). Some better-ranked oil and gas stocks include Kosmos Energy Ltd. (KOS), Matrix Service Company (MTRX) and BPZ Resources Inc. (BPZ). All these stocks sport a Zacks Rank #1 (Strong Buy).
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