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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Schlumberger Ltd | NYSE:SLB | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.10 | 0.21% | 47.68 | 47.97 | 47.13 | 47.66 | 11,106,909 | 01:00:00 |
By Selina Williams
LONDON--Russia's largest onshore oil drilling firm Eurasia Drilling Co. Ltd. said Monday it would extend a final deadline on a proposal to sell a stake to oil-field services giant Schlumberger Ltd. for about $1.7 billion.
Russian officials haven't approved the deal over concerns that EDC's activities could be affected if western sanctions against Russia over the crisis in Ukraine are extended further. Russia's federal antimonopoly service and the commission on foreign investment are reviewing the deal.
In January, Schlumberger said it had agreed to buy a 45.65% stake in EDC, with an option to buy the rest of the Russian company at a later date. The transaction was originally expected to close by the end of March but now has until the end of April, EDC said.
The deal will be terminated if conditions aren't met by then. Schlumberger declined to comment.
The deal would represent an unusually large investment by a U.S.-listed company in Russia's oil industry at a time of heightened tensions between Moscow and the West.
While much of the Russian oil industry isn't subject to overall sanctions, Western governments have targeted parts of the industry, and if tensions with Moscow don't cool, restrictions could expand.
EDC operates the largest fleet of onshore drill rigs in Russia and is vital to operations at the country's conventional oil fields. Russia's economy is highly dependent on hydrocarbons. Oil-and-gas revenues account for around half its federal budget revenues.
The head of Russia's antimonopoly service Igor Artemyev said last week one of the conditions being discussed for approval of the deal includes the sale of Schlumberger's stake to a Russian investor if further western sanctions prevented the company from operating in Russia, RIA Novosti reported.
Schlumberger's move to acquire a stake in EDC extends a strategic alliance between the two companies that dates back to 2011.
The deal had enabled the two firms to work together to deploy a range of drilling and well-engineering services to customers in the Russian conventional drilling market, Schlumberger said in January.
Russia has long been a lucrative market for Schlumberger. While sanctions have sharply reduced western investment in Russia in the past year, many major multinationals say they plan to remain in the country in the hope of a recovery once geopolitical tensions ease.
EDC, which acquired Lukoil's drilling subsidiary in 2004, is listed on the London Stock Exchange through global depository receipts. Upon completion of the deal, the company will be delisted and Schlumberger will acquire a 45.65% stake for $22 a share. That represents an 81% premium to EDC's closing price before the proposed deal was announced.
Write to Selina Williams at Selina.williams@wsj.com
Write to Selina Williams at selina.williams@wsj.com
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