Tags: schlumberger | oilfield

Schlumberger Said to Seek Buyer for Oilfield-Supply Business

Wednesday, 14 March 2012 05:25 PM

Schlumberger Ltd., the world’s largest oil-services company, is seeking buyers for a unit that distributes oilfield supplies, a business that may fetch as much as $800 million, said people with knowledge of the matter.

Schlumberger hired Goldman Sachs Group Inc. to work on the potential sale, said the people, who spoke on condition of anonymity because the process is private. The operations include Houston-based Wilson International and a 56 percent stake in Calgary-based CE Franklin Ltd., both acquired through the $11 billion purchase of Smith International Inc. in 2010.

Possible suitors include private equity firms and Schlumberger’s rivals, said the people. Competitors include National Oilwell Varco Inc. and MRC Global Inc., which calls itself the world’s largest distributor of pipe, valves and fittings to the energy industry.

Schlumberger plans to “explore possible transactions” with its 56 percent stake in Franklin, according to a securities filing released earlier this year. Its 9.72 million shares were worth about C$94.4 million ($95 million) based on a C$9.71 price as of the close of Toronto trading March 12.

Schlumberger, based in Houston and Paris, generated more than $2.6 billion in sales from the distribution business last year, or about 6.6 percent of total revenue. That compares with $1.9 billion at National Oilwell’s distribution unit and $4.8 billion at MRC.

MRC, based in Houston and formerly known as McJunkin Red Man, is majority owned by Goldman Sachs’s private-equity arm. The company filed for an initial public offering in January.

“We don’t comment on market rumors,” said Mary Jo Caliandro, a Schlumberger spokeswoman, via e-mail. Michael DuVally, a Goldman Sachs spokesman, declined to comment.

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Wednesday, 14 March 2012 05:25 PM
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