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Monday, February 14, 2011

GE Bulks Up Its Oil & Natural Gas Capabilities

General Electric Co. (GE) has agreed to buy the well-support division of John Wood Group PLC for $2.8 billion in cash.  , GE is probably gearing up to pursue the extracting natural gas from shale via the hydraulic fracturing technique.

GE beat out competitors including Halliburton Co. in the bidding for the unit. GE has built its oil and gas services operations through acquisitions, such as its recent deal to buy Wellstream and previous purchases of Vetro Gray and Hydril. The investments have helped offset weakness in the turbine side of GE's energy business.

The company's well-support division has 3,800 employees and more than 20 manufacturing centers world-wide. GE expects the division to generate $1.1 billion in revenue and about $200 million in earnings before interest, taxation, depreciation and amortization in 2011. (WSJ, 2/14/2011)

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