Weatherford sells some assets to Schlumberger for $430 million

By Patrick C. Miller | January 09, 2018

Weatherford International is selling its U.S. pressure pumping and pump-down perforating assets to a subsidiary of Schlumberger Limited for $430 million.

Weatherford and Schlumberger agreed to revised deal terms that reflect an asset sale, rather than previously announced OneStim joint venture. Under the transaction, Schlumberger will take ownership of Weatherford's U.S. pressure pumping and pump-down perforating related facilities and supplier and customer contracts.

About 100 Weatherford employees associated with the pressure pumping and pump-down perforating businesses will transfer to Schlumberger. Weatherford will retain its multistage completions portfolio, manufacturing capability and supply chain. In addition, the company will continue to participate in the completions markets in Canada, the U.S. and globally.

"Although not as originally anticipated, this transaction delivers cash proceeds that enable our company to begin the deleveraging process and, coupled with our transformation plans, will lead to a leaner organization with lower debt and significantly higher profit margins,” said Mark McCollum, Weatherford president and CEO. “In addition, retaining 100 percent of our leading land-based multistage completions business allows for significant upside potential for Weatherford."

Weatherford plans to use the proceeds from the sale to reduce outstanding indebtedness. "The closing of this transaction represents another step on our path toward building a solid and strong company and unlocking the potential that exists within Weatherford," McCollum said.

In March 2017, Weatherford announced the OneStim joint venture with Schlumberger which was to deliver completions products and services for the development of unconventional resource plays in the United States and Canada land markets. Last fall, Weatherford announced that it was nearing the completion of the deal with Schlumberger affiliates.

The companies would have shared ownership of the joint venture with Schlumberger controlling 70 percent and Weatherford 30 percent. Weatherford would have received a one-time $535 million cash payment from Schlumberger.