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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Big Dog who wrote (21836)	5/11/1998 4:24:00 PM
From: mph	Read Replies (1) \| Respond to of 95453

Like your style and prognosis, Mr. Big. Here's some "news" : Monday May 11, 3:52 pm Eastern Time Moody's may up Baker Hughes ,Western Atlas (Press release provided by Moody's Investors Service) NEW YORK, May 11 - Moody's Investors Service placed both the A2 senior unsecured ratings of Baker Hughes Incorporated and the A3 senior unsecured ratings of Western Atlas Inc. (WAI - news) under review for possible upgrade. The rating actions were prompted by the announcement earlier today that the two companies had reached a definitive agreement to merge in a tax-free stock-for-stock transaction valued at approximately $5.5 billion. The merger will be accounted for as a pooling of interests and will include the assumption by Baker Hughes of approximately $1.18 billion of Western Atlas' debt. The transaction is subject to shareholder and regulatory approvals, and is expected to close in the third quarter of 1998. With assets of about $7 billion, the proposed combination of Baker Hughes and Western Atlas (to be named Baker Hughes) will rank as the third-largest diversified oilfield services company in the world, behind Schlumberger and the proposed merger of Dresser Industries and Halliburton Company. The addition of Western Atlas' seismic, wireline, and reservoir characterization businesses to Baker Hughes' drilling, completion, and production services businesses will allow the companies to offer products and services across all phases of the oil and gas exploration and production spectrum on a worldwide basis. Other strategic benefits of the transaction include opportunities to expand the integrated drilling solutions business, as well as new opportunities in reservoir management. In addition, the merger is expected to generate approximately $135 million of pre-tax benefits during the first year of combined operations, mainly as a result of operating cost savings. Moody's review will assess the benefits of Baker Hughes' enhanced market position, including its ability to form long-term strategic alliances with its customers. Moody's will also evaluate the extent to which the combined company will be able to compete with its larger, more highly rated peers, and the degree to which it will be able to withstand reductions in capital spending by oil and gas companies in reaction to a sustained decline in commodity prices. Moody's review will also focus on Baker Hughes' growth strategy, the likelihood of future acquisitions, and management's financial policies. Ratings under review for possible upgrade are: Baker Hughes Incorporated's senior unsecured debt at A2, its LYONS convertible securities at A2, and its shelf registration for senior unsecured debt at (P)A2; and Western Atlas Inc.'s senior unsecured debt at A3, its preferred stock at ''baa1,'' and its Prime-2 rating for commercial paper. Headquartered in Houston, Texas, Baker Hughes Incorporated is a leading provider of products and services for the oil, gas, and process industries. Western Atlas is a leading provider of seismic, wireline logging, and reservoir information services and is headquartered in Houston, Texas. More Quotes and News: Baker Hughes Inc (NYSE:BHI - news) Western Atlas Inc (NYSE:WAI - news) Related News Categories: US Market News, options Help Copyright c 1998 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon See our Important Disclaimers and Legal Information. Questions or Comments?