Baker Hughes, CSL & GS Form New US Fracking Co: BJ Services

bj-servicesThe world’s third largest oilfield services company, Baker Hughes, has struggled to stay afloat given the radical reduction in revenue they get for the services they offer. BH’s recent third quarter update showed the company lost $430 million, which is down from losing $912 million in 3Q15, a positive sign we suppose (see Baker Hughes 3Q16: Bleeding Slows, but Hefty Loss of $430M). Halliburton tried to buy BH last year, but earlier this year the Obama DOJ killed the proposed merger (see Obama DOJ Kills Halliburton/Baker Hughes Merger, Deal “Terminated”). Last month GE Oil & Gas launched its own takeover/merger with BH (see Breaking: Who Needs Halliburton? Baker Hughes Merging with GE O&G). In the midst of all that, BH is not sitting on its hands. Yesterday the company announced it will spin off its North American shale fracking business into a new company, BJ Services. The deal involves investments and assets contributed from both Goldman Sachs and CSL Capital Management. Here’s the lowdown on BH’s new “pressure pumping” (i.e. fracking) deal, and the real reason BH is doing it…

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