After Halliburton failed to close the deal with Baker Hughes for $34b, GE has swooped in to merge their oil operations with the company, forming an oil giant valued at more than $30b. Clearly, Immelt and GE’s management believes oil has bottomed. But it’s worth noting, GE was wrong in the early 2000s on telecom, wrong again on housing in 2007 and probably wrong again here now. Their track record for betting on big trend shifts has been abysmal, which is why the share price has done dick in over a decade plus.
“This transaction creates an industry leader, one that is ideally positioned to grow in any market,” GE Chief Executive Jeff Immelt said in a statement.
“Oil and gas customers demand more productive solutions. This can only be achieved through technical innovation and service execution, the hallmarks of GE and Baker Hughes.”
GE will own 62.5 of the newly formed company. BHI shareholders will get a special dividend of $17.5 after the deal closes.
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DO they and HRC know something we don’t ..//sarc off
So will BHI cease to exist in its current company form, assuming this deal goes through?