Some big acquisition news in the oilfield service industry today, as Baker Hughes (NYSE: BHI) announced that it would be buying BJ Services (NYSE: BJS).
The deal is for cash and stock, and is reportedly valued at $5.5 billion.
According to the details that have been released, BJS stockholders will be getting 0.40035 shares of BHI stock in addition to $2.69 in cash.
BJ Services stock closed trading on Friday at $15.43 and is up 7.3% on the day following the news of the acquisition.
The deal is expected to give Baker Hughes cost savings of $75 million in 2010 and $100 million in 2011. Baker Hughes expects the deal will add to earnings per share during 2011.
In a statement today, Baker Hughes' Chief Financial Officer, Peter Ragauss, stated that the deal will result in rolling cost savings that will increase over time.
Baker Hughes stock is trading down 7.9% on the day to $35.08, down $3.01.
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