Halliburton Company and Baker Hughes Incorporated announced yesterday that the companies have terminated the merger agreement they entered into in November 2014. The termination was effective April 30, 2016.
Staff at the local Halliburton office were not able to comment on potential local impacts, and a public relations representative for the company was not immediately available for comment.
Representatives from Halliburton and Baker Hughes made the following statements in a press release from Halliburton.
“While both companies expected the proposed merger to result in compelling benefits to shareholders, customers and other stakeholders, challenges in obtaining remaining regulatory approvals and general industry conditions that severely damaged deal economics led to the conclusion that termination is the best course of action,” said Dave Lesar, Chairman and Chief Executive Officer of Halliburton in a press release from Haliburton. “I sincerely thank both our employees as well as the Baker Hughes employees for their tireless efforts throughout the regulatory review process. While disappointing, Halliburton remains strong. We are the execution company – our strategy, technologies and service quality are focused on helping customers maximize production at the lowest cost and driving industry leading growth, margins and returns.”
Martin Craighead, Chairman and Chief Executive Officer of Baker Hughes also made a statement in the release.
“Today’s outcome is disappointing because of our strong belief in the vast potential of the business combination to deliver benefits for shareholders, customers and both companies’ employees,” said Craighead. “This was an extremely complex, global transaction and, ultimately, a solution could not be found to satisfy the antitrust concerns of regulators, both in the United States and abroad. As we turn the page on this chapter, I want to thank our customers for their patience and continued loyalty over the past 18 months. I also want to thank the entire Baker Hughes team for their unwavering dedication and commitment during this process. Baker Hughes is strongly positioned to build on its foundation and heritage as a technology innovator that differentiates for our customers and delivers compelling value to shareholders.”
In connection with the termination of the merger agreement, Halliburton will pay Baker Hughes the termination fee of $3.5 billion by Wednesday, May 4, 2016.
Halliburton will discuss the termination of the merger agreement during its previously scheduled conference call on Tuesday, May 3, 2016, at 7:00 a.m. Mountain Time.
Those interested in listening to the call via webcast can do so through Halliburton’s website. Interested parties may also participate in the call by dialing (888) 793-5581 within North America or (973) 935-8723 outside North America. A passcode is not required.
Halliburton says those wanting to listen to the call should log in to the webcast or dial in approximately 15 minutes before the start time.