Halliburton - Baker Hughes Acquisition

We are excited to share news of a historic step by our company to advance the depth and breadth of our capabilities to better serve our customers. Halliburton's pending acquisition of Baker Hughes is a natural combination from a customer service and financial perspective. This pending acquisition would combine product and service capabilities to allow us to build upon the innovative leadership of both companies. As previously communicated in March, Halliburton and Baker Hughes each obtained the required approvals from their respective stockholders for the proposed acquisition to proceed. However, the actual close of the transaction is expected to occur late in 2015, and remains subject to regulatory approvals and other customary closing conditions.

Halliburton and Baker Hughes are in the midst of planning the integration of the two companies across our product lines, regions of operation, and functional support areas. Throughout this process, enthusiasm for the project has been high from the employees of both companies.

At the core of the integration planning process is a focus on customer service, safety, operational excellence and financial synergies as we work towards building a stronger company and creating a seamless transition for employees, customers, suppliers, and stakeholders.

We are committed to providing insight into our progress on the pending acquisition with updates to this website as appropriate, including regarding what may change and what is expected to stay the same. We are confident that the combined company will be a stronger and more diverse organization with the resources to better serve our valued customers well into the future.

Jeff Miller, President
 
 

Customer FAQs

 
Frequently Asked Questions
DOJ Update
  • What does this news mean?

    • Halliburton Company and Baker Hughes intend to vigorously contest the U.S. Department of Justice (DOJ) effort to block their pending merger.

      The companies intend to demonstrate that the DOJ has underestimated the highly competitive nature of the oilfield services industry, the many benefits of the proposed combination, and the sufficiency of the proposed divestitures.

      Posted April 7, 2016

  • Does this mean the deal is in jeopardy?

    • The DOJ cannot unilaterally stop a merger — it must make its case in federal court.

      The DOJ complaint asks a federal district court to enjoin, or prevent, Halliburton from merging with Baker Hughes. But the decision is not for the DOJ to make; this decision belongs to the court, which will decide whether the merger may proceed. The DOJ filing has no other ramifications.

      The parties look forward to our day in court, and are preparing with confidence to demonstrate that the proposed transaction is pro-competitive, and that the DOJ is wrong to contend otherwise.

      Posted April 7, 2016

  • Does Halliburton still believe the pending Baker Hughes acquisition benefits its stakeholders?

    • Halliburton believes that the combination of Halliburton and Baker Hughes is a pro-competitive merger that is good for the industry and customers. This merger will create a strong company that will compete aggressively to provide efficient, innovative and low-cost services.

      The merger of Halliburton and Baker Hughes is especially important for its key stakeholders because it is happening in the context of the challenges facing the U.S. and global energy industry. These challenges require oilfield services companies to become more flexible, innovative and efficient. And that is precisely what this merger accomplishes.

      The Halliburton and Baker Hughes combination will leverage the complementary strengths of the companies to create a diversified oilfield services company that will introduce customer solutions, and is expected to achieve efficiencies that will enable the company to provide lower-cost services to its customers.

      Posted April 7, 2016

  • What happens next?

    • Halliburton and Baker Hughes intend to vigorously contest the DOJ’s effort to block their pending merger.

      At the same time, Halliburton and Baker Hughes are continuing to work constructively to resolve any remaining issues with the European Commission and all other competition enforcement authorities that have expressed an interest in the proposed transaction.

      Halliburton and Baker Hughes will provide updates on the regulatory process as appropriate.

      Posted April 7, 2016

  • Does the DOJ’s action have an impact on other regulators?

    • The merger between Halliburton and Baker Hughes is global in scope, requiring clearance from numerous regulators around the world.

      A number of those jurisdictions have already cleared this merger; others are still conducting their reviews.

      We expect these regulators will keep a close eye on the U.S. proceedings. Each foreign regulator may exercise its independent judgment under its own legal regimes, but in line with international policy, we expect that the regulators will seek to reach consistent outcomes across jurisdictions.

      Posted April 7, 2016

  • What does this mean for the previously announced divestiture plans?

    • The previously announced plans to divest Halliburton’s Fixed Cutter and Roller Cone Drill Bits, Directional Drilling, and Logging-While-Drilling/Measurement-While-Drilling — in addition to the identified Baker Hughes businesses — remain unchanged.

      Halliburton, including the businesses held for sale, will continue to operate as one company until the sale of the identified businesses is complete, and Halliburton and Baker Hughes will continue to operate as separate, independent companies.

      Posted April 7, 2016

  • Will additional divestitures be announced?

    • When we announced the Baker Hughes acquisition, Halliburton expected to be required to divest certain of the companies’ overlapping businesses to obtain competition authorities’ approvals.

      Halliburton and Baker Hughes believe in this transaction, and early in the process proposed to the DOJ a divestiture package worth billions of dollars that will facilitate the entry of new competition in markets in which products and services are being divested. More recently, Halliburton and Baker Hughes added to the divestiture proposal in an effort to achieve resolution and bring the benefits of the merger to the market sooner.

      The companies strongly believe their proposed divestitures are more than sufficient to address concerns of competition authorities, including the DOJ.

      Posted April 7, 2016

Customer Service
  • Why is Halliburton’s pending acquisition of Baker Hughes good for customers?

    • Better, combined company - We believe that the acquisition of Baker Hughes provides for a stronger, more efficient Halliburton — one that can deliver better services with the combined strengths of the two companies and at a lower cost to you.

      Lower costs - Our focus is always on reducing your costs and this continues to be our focus as we look at the pending acquisition. Applying Halliburton processes and procedures to the assets acquired from Baker Hughes is expected to improve their efficiency. We will be looking at innovation to reduce costs for customer solutions. A good example is what we did with Frac of the Future. This helped us create a full process that is extremely efficient and delivers the lowest cost. We plan to apply the same type of processes to the Baker Hughes businesses we acquire.

      Global breadth and depth - The acquisition provides expanded geographic reach and enhances economies of scale in certain markets.

      Comprehensive services and innovative solutions - From a quality perspective, innovation will occur with the best-of-breed strengths of both Baker Hughes and Halliburton. Innovation is enhanced with a platform that comprises the best elements of the combined companies' businesses.

      Posted February 22, 2016

  • How will Hallibuton ensure that it has managed risk and that the quality of service will be there?

    • Dedicated Integration Team of many professionals working months to prepare

      We have been operating a strong integration planning team for months. This team is completely separate from our operational business, allowing it to focus solely on ensuring a smooth post-close integration. We’ve considered the issues that might arise in light of the acquisition and have developed plans that will be implemented after closing.

      Even in challenging times, we’ve delivered continued improvement in HSE and SQ. Despite ongoing market conditions, Halliburton continues to demonstrate improvement in HSE and SQ statistics. Our core value of delivering safe, high-quality services stays out in front of everything we do. It’s reiterated in all our planning focus and integration execution documents. We will continue to deliver for you.

      There will not be much change out of the gate - stability of our delivery and organization is a priority over immediate change. We are striving to ensure that we operate the business out of the gate in a manner that continues to support ongoing services from Halliburton and Baker Hughes. In doing so, we will delay some changes to allow us time to integrate the new BHI team to Halliburton. There will be change, but it will occur in a stepwise fashion.

      Detailed plans, including “playbooks,” will be in place to ensure a solid integration. Planning and documenting the integration changes have been the focus of the integration planning team to ensure implementation of a well-executed post-closing plan.

      Key leaders will be selected for clear guidance. Additional personnel will also be thoughtfully selected onto the Halliburton team. Key leaders will be in place initially, but we will take a short period to evaluate the best people to be part of the future Halliburton. During that period, employees have playbooks and leadership direction so there is no confusion on how to run the business.

      We’ve researched what makes integrations successful - or not. Two keys aspects make the most difference:

      A focus on culture - We’ve put an emphasis on supporting the team from Baker Hughes and have been encouraged by their integration planning team’s excitement about becoming part of Halliburton.

      Speed of integration - An emphasis on strong leadership for the supporting elements of the integration, such as systems and processes. Planning helps with the speed of post-close execution by detailing the steps to the desired result.

      There are more aspects involved in our integration planning, but we hope this provides you with an understanding of our investment and planning so we can continue to be a company you can count on.

      Posted February 22, 2016

  • What supports the expectation that products and services Halliburton plans to divest will be an ongoing viable business delivering the same service?

    • Regulatory approval requires the assurance of a competitive market.

      In order to satisfy regulatory requirements, we must satisfy potential concerns about there being sufficient competition after the transaction is completed. It is more than a question of consolidated market share for Halliburton. The sale of assets is designed to establish another strong competitor in each applicable product line.

      We will be setting up a viable competitor with the transfer of our business to the new company(ies).

      To ensure the same level of service, we will be transferring or transitioning the necessary personnel, facilities and intellectual property. We will be supporting those services with current Halliburton or Baker Hughes infrastructure and processes if and as needed, and allowing for time to secure necessary licenses, permits, certifications and supporting infrastructure.

      You are an important customer to Halliburton both now and into the future. We understand how vital it is to make this a clean and supported transition.

      You remain an important customer to us for many services that will be provided by Halliburton into the future. We want this to be a clean and successful transition.

      Posted February 22, 2016

  • What will happen to our existing or new contracts?

    • Existing contracts will continue in accordance with their terms.

      Existing contracts with Halliburton and unrelated to a divested business will continue in accordance with their terms. If a contract is associated with a divested business, we and the buyer of the divested business will work together to enable a smooth transition of the applicable obligations under that contract, keeping our customers’ interests at the forefront.

      We anticipate the divested businesses will honor all tenders at the pending close date.

      The businesses expected to be divested are intricately involved in the tendering process. Accordingly, we expect that the divested business will honor and support tenders as they stand at closing date of the transaction. We will work with you if local country laws dictate special handling of contracts and tenders.

      We are aware of the different implications of contracting and tendering for the various countries in which we operate. Our plans take into consideration such local factors.

      With respect to the incoming Baker Hughes contracts and tenders: Prior to the closing of the transaction, we cannot respond in detail to questions concerning their impact. However, we reiterate that existing contracts with Halliburton will continue in accordance with their terms.

      Posted February 22, 2016

Safe Harbor

The statements in this communication that are not historical statements, including statements regarding the companies’ anticipated actions regarding the DOJ’s decision, the anticipated benefits and synergies of the acquisition of Baker Hughes and the expected timing of the closing of the acquisition of Baker Hughes, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company’s control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: with respect to the Baker Hughes acquisition, the timing to consummate the proposed transaction; the outcome of any litigation involving the DOJ; the terms and timing of divestitures undertaken to obtain required regulatory approvals; the conditions to closing of the proposed transaction may not be satisfied or the closing of the proposed transaction otherwise does not occur; the risk a regulatory approval that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; the diversion of management time on transaction-related issues; the ultimate timing, outcome and results of integrating the operations of Halliburton and Baker Hughes and the ultimate outcome of Halliburton’s operating efficiencies applied to Baker Hughes’s products and services; the effects of the business combination of Halliburton and Baker Hughes, including the combined company’s future financial condition, results of operations, strategy and plans; and expected synergies and other benefits from the proposed transaction and the ability of Halliburton to realize such synergies and other benefits. Halliburton’s Form 10-K for the year ended December 31, 2015 and other Securities and Exchange Commission filings discuss some of the important risk factors identified that may affect Halliburton’s business, results of operations, and financial condition. Halliburton undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

 

Additional Information

This communication does not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities or a solicitation of any vote or approval. This communication relates to a proposed business combination between Halliburton and Baker Hughes. In connection with this proposed business combination, Halliburton has filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4, including Amendments No. 1 and 2 thereto, and a definitive joint proxy statement/prospectus of Halliburton and Baker Hughes and other documents related to the proposed transaction. The registration statement was declared effective by the SEC on February 17, 2015 and the definitive proxy statement/prospectus has been mailed to stockholders of Halliburton and Baker Hughes. INVESTORS AND SECURITY HOLDERS OF HALLIBURTON AND BAKER HUGHES ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS, REGISTRATION STATEMENT AND OTHER DOCUMENTS FILED OR THAT MAY BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders may obtain free copies of these documents and other documents filed with the SEC by Halliburton and/or Baker Hughes through the website maintained by the SEC at www.sec.gov. Copies of the documents filed with the SEC by Halliburton are available free of charge on Halliburton’s internet website at www.halliburton.com or by contacting Halliburton’s Investor Relations Department by email at Investors@Halliburton.com or by phone at +1-281-871-2688. Copies of the documents filed with the SEC by Baker Hughes are available free of charge on Baker Hughes’ internet website at www.bakerhughes.com or by contacting Baker Hughes’ Investor Relations Department by email at alondra.oteyza@bakerhughes.com or by phone at +1-713-439-8822.

 

Participants in Solicitation

Halliburton, Baker Hughes, their respective directors and certain of their respective executive officers may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of Halliburton is set forth in its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 5, 2016, its proxy statement for its 2016 annual meeting of stockholders, which was filed with the SEC on April 5, 2016. Information about the directors and executive officers of Baker Hughes is set forth in its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 17, 2016, Amendment No. 1 to its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 19, 2016, and its proxy statement for its 2015 annual meeting of stockholders, which was filed with the SEC on March 27, 2015. These documents can be obtained free of charge from the sources indicated above. Additional information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, are contained in the proxy statement/prospectus and other relevant materials filed with the SEC.

Frequently Asked Questions

Posted October 2015

 
Frequently Asked Questions
  • Why is Halliburton acquiring Baker Hughes?

    • We believe the transaction will combine product and service capabilities to deliver a greater depth and breadth of solutions to our customers and exciting growth opportunities for our employees and shareholders. As a result, we expect the combination to result in substantial and improved growth opportunities and continued high returns on capital.

      The combined company will be able to provide a comprehensive suite of products and services to customers in virtually every oil and natural gas producing market in the world with the ability to provide cost-effective solutions to customer challenges in the unconventional, deepwater and mature asset sectors.

  • Where are we in the process of planning for the integration of Halliburton and Baker Hughes?

    • Halliburton's integration team has held high-level discussions and exchanged general information with its Baker Hughes counterparts and has now transitioned into the planning phase of the integration. Please understand that we are unable to share further details with the public or our customers at this time. We are working diligently to ensure a smooth transition for our employees, customers and other stakeholders once the deal is finalized.

  • What are the benefits of the transaction for customers?

    • We are confident that the combined company will be a stronger, more global and diverse organization with the scale and resources to better serve our valued customers.

      The combined company will also have the ability to continue to commit appropriate levels of investment in the technologies required to support more efficient development of oil and gas assets around the world.

      Finally, we believe the combined company will allow us to achieve synergies that lead to greater innovation and superior, cost-effective service for our customers.

  • What are your customers saying about this pending transaction?

    • The pending Halliburton and Baker Hughes transaction is a natural combination, both from a customer service and financial perspective. Customer feedback has been largely positive. Halliburton and Baker Hughes have worked separately to address any issues customers have raised.

  • Will there be any change to customer contracts with Halliburton?

    • At this time, there are no changes to customer contracts with Halliburton.

  • Will there be any change in the products and services I receive from Halliburton?

    • Prior to the close of the deal, we remain committed to providing the same reliable service and innovative products that you have come to expect from Halliburton. We are excited about the future possibilities for synergies and innovation that our pending acquisition of Baker Hughes will bring.

  • If a customer has business with both Halliburton and Baker Hughes, how will this affect the services, products and solutions they receive from Halliburton while the acquisition is pending?

    • Halliburton and Baker Hughes remain competitors prior to the close of the deal, and customers should not expect any changes in our services to them.

  • Why is Halliburton marketing for sale its Fixed Cutter and Roller Cone Drill Bits, its Directional Drilling and its Logging-While-Drilling (LWD)/Measurement-While-Drilling (MWD) businesses?

    • As anticipated, Halliburton will be required to divest some of its overlapping businesses to obtain competition authorities' approval of the pending acquisition of Baker Hughes.

  • When will the divestitures take place?

    • It may take some time to find the right fit for these valuable businesses. As the goal is for the divested businesses to remain competitive, we want to ensure they are sold to buyers who will run them as such.

      The eventual close of the divestitures is expected to coincide with the closing of our pending acquisition of Baker Hughes late in the second half of 2015.

  • Who can I contact with additional questions?

    • Due to the sensitivity of this transaction, we are unable to answer many detailed questions at this time. We appreciate our customers and will continue to provide updates on a quarterly basis as we move through this process. In the meantime, if you have any questions or concerns please do not hesitate to reach out to your regular Halliburton contact or BHI-Integration@halliburton.com.

Safe Harbor

The statements in this communication that are not historical statements, including statements regarding the Company’s plans for integration of the companies, the Company’s expectations regarding treatment of existing contracts before and after the divestitures occur, expected benefits of the proposed transaction, future opportunities for the combined company and products, future financial performance and any other statements regarding the Company’s and Baker Hughes’ future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertainties, many of which are beyond the company’s control, which could cause actual results to differ materially from the results expressed or implied by the statements. These risks and uncertainties include, but are not limited to: with respect to the Baker Hughes acquisition, the timing to consummate the proposed transaction; the terms, timing and completion of divestitures undertaken to obtain required regulatory approvals; the conditions to closing of the proposed transaction may not be satisfied or the closing of the proposed transaction otherwise does not occur; the risk a regulatory approval that may be required for the proposed transaction is not obtained or is obtained subject to conditions that are not anticipated; the diversion of management time on transaction-related issues; the ultimate timing, outcome and results of integrating the operations of Halliburton and Baker Hughes and the ultimate outcome of Halliburton’s operating efficiencies applied to Baker Hughes’s products and services; the effects of the business combination of Halliburton and Baker Hughes, including the combined company’s future financial condition, results of operations, strategy and plans; expected synergies and other benefits from the proposed transaction and the ability of Halliburton to realize such synergies and other benefits; with respect to the Macondo well incident, final court approval of, and the satisfaction of the conditions in, Halliburton’s September 2014 settlement, including the results of any appeals of rulings in the multi-district litigation; indemnification and insurance matters; with respect to repurchases of Halliburton common stock, the continuation or suspension of the repurchase program, the amount, the timing and the trading prices of Halliburton common stock, and the availability and alternative uses of cash; changes in the demand for or price of oil and/or natural gas can be significantly impacted by weakness in the worldwide economy; consequences of audits and investigations by domestic and foreign government agencies and legislative bodies and related publicity and potential adverse proceedings by such agencies; protection of intellectual property rights and against cyber attacks; compliance with environmental laws; changes in government regulations and regulatory requirements, particularly those related to offshore oil and natural gas exploration, radioactive sources, explosives, chemicals, hydraulic fracturing services, and climate-related initiatives; compliance with laws related to income taxes and assumptions regarding the generation of future taxable income; risks of international operations, including risks relating to unsettled political conditions, war, the effects of terrorism, foreign exchange rates and controls, international trade and regulatory controls, and doing business with national oil companies; weather-related issues, including the effects of hurricanes and tropical storms; changes in capital spending by customers; delays or failures by customers to make payments owed to us; execution of long-term, fixed-price contracts; structural changes in the oil and natural gas industry; maintaining a highly skilled workforce; availability and cost of raw materials; and integration and success of acquired businesses and operations of joint ventures. Halliburton’s Form 10-K for the year ended December 31, 2015, recent Current Reports on Form 8-K, and other Securities and Exchange Commission filings discuss some of the important risk factors identified that may affect Halliburton’s business, results of operations, and financial condition. Halliburton undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

 

Additional Information

This communication does not constitute an offer to buy or sell or the solicitation of an offer to buy or sell any securities or a solicitation of any vote or approval. This communication relates to a proposed business combination between Halliburton and Baker Hughes. In connection with this proposed business combination, Halliburton has filed with the Securities and Exchange Commission (the “SEC”) a registration statement on Form S-4, including Amendments No. 1 and 2 thereto, and a definitive joint proxy statement/prospectus of Halliburton and Baker Hughes and other documents related to the proposed transaction. The registration statement was declared effective by the SEC on February 17, 2015 and the definitive proxy statement/prospectus has been mailed to stockholders of Halliburton and Baker Hughes. INVESTORS AND SECURITY HOLDERS OF HALLIBURTON AND BAKER HUGHES ARE URGED TO READ THE JOINT PROXY STATEMENT/PROSPECTUS, REGISTRATION STATEMENT AND OTHER DOCUMENTS FILED OR THAT MAY BE FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION. Investors and security holders may obtain free copies of these documents and other documents filed with the SEC by Halliburton and/or Baker Hughes through the website maintained by the SEC at http://www.sec.gov. Copies of the documents filed with the SEC by Halliburton are available free of charge on Halliburton’s internet website at http://www.halliburton.com or by contacting Halliburton’s Investor Relations Department by email at investors@Halliburton.com or by phone at +1-281-871-2688. Copies of the documents filed with the SEC by Baker Hughes are available free of charge on Baker Hughes’ internet website at http://www.bakerhughes.com or by contacting Baker Hughes’ Investor Relations Department by email at alondra.oteyza@bakerhughes.com or by phone at +1-713-439-8822.

 

Participants in Solicitation

Halliburton, Baker Hughes, their respective directors and certain of their respective executive officers may be considered participants in the solicitation of proxies in connection with the proposed transaction. Information about the directors and executive officers of Halliburton is set forth in its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 5, 2016, and its proxy statement for its 2015 annual meeting of stockholders, which was filed with the SEC on April 7, 2015. Information about the directors and executive officers of Baker Hughes is set forth in its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 17, 2016, Amendment No. 1 to its Annual Report on Form 10-K for the year ended December 31, 2015, which was filed with the SEC on February 19, 2016, and its proxy statement for its 2015 annual meeting of stockholders, which was filed with the SEC on March 27, 2015. These documents can be obtained free of charge from the sources indicated above. Additional information regarding the participants in the proxy solicitations and a description of their direct and indirect interests, by security holdings or otherwise, are contained in the proxy statement/prospectus and other relevant materials filed with the SEC.