Key Takeaways
- SLB on Tuesday announced it was paying about $7.8 billion in stock to purchase rival oilfield services provider ChampionX.
- The approximately $40.59 per share offer was a 14.7% premium over ChampionX’s closing price Monday.
- SLB also said it would be returning $7 billion to its shareholders over the next two years.
Shares of ChampionX (CHX) jumped Tuesday after SLB (SLB) agreed to buy the rival oilfield services provider in an all-stock transaction valued at about $7.8 billion.
SLB announced that ChampionX investors would receive 0.735 share of SLB for every share of ChampionX they owned. That works out to be $40.59 per share, a 14.7% premium over ChampionX’s closing price Monday.
SLB Chief Executive Officer (CEO) Olivier Le Peuch said that his company’s customers are “seeking to maximize their assets while improving efficiency in the production and reservoir recovery phase of their operations,” including the use of artificial intelligence (AI) and autonomous operations. He added that SLB combining with ChampionX “will drive tremendous value for our customers and stakeholders.”
It was the second major purchase by SLB in a week. Last Wednesday, it announced a $380 million deal to acquire a majority stake in Norway’s Aker Carbon Capture.
SLB noted that the ChampionX transaction is expected to close by the end of this year.
In addition, the company reported that it would be increasing its return to shareholders, targeting $3 billion in 2024 and $4 billion in 2025.
As of 12:07 p.m. ET Tuesday, ChampionX shares were up about 9% to $38.59, their highest level in nearly five years. Shares of SLB fell 1.9% to $54.15.
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