The pending merger between Halliburton Company HAL and Baker Hughes Incorporated BHI has been further delayed with the European Union (“EU”) antitrust regulators deferring investigation for the third time in a row. Per the European Commission, the move has been triggered by the lack of vital data regarding the merger between the two oilfield service providers.
In Feb 2016, the European Commission halted its scrutiny of the proposed $35 billion transaction citing the companies’ failure to provide important details. The probe was resumed on Mar 8 with the ruling scheduled for Jul 11. However, the process has been deferred yet again and is expected to proceed once the necessary details have been submitted.
The Halliburton-Baker Hughes merger was confirmed in Nov 2014 after many days of speculation. The combined entity would become the world’s second-largest oilfield services provider after Schlumberger Ltd. SLB.
The deal has been approved by the boards of both companies. It has also received regulatory clearances from Canada, Colombia, Ecuador, Kazakhstan, South Africa and Turkey. However, the deal is pending approval from the U.S. and the EU regulatory authorities who are concerned that this merger, if approved, would impede competition and increase prices.
In order to ensure that no monopolies are created, the regulatory authorities might also require assets of the merged company to be sold to its competitors. In fact, Halliburton is reportedly being pressurized by the U.S. Justice Department to shed more assets in order to get antitrust approval.General Electric GE and Weatherford International WFT are said to be among buyers for some of the assets that Halliburton will be selling in the process.
Houston, TX-based Halliburton is one of the largest oilfield service providers in the world, offering a variety of equipment, maintenance, and engineering and construction services to the energy, industrial, and government sectors.
Baker Hughes is also a major oilfield service firm providing an array of services to the global oil and gas industry.
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