GE, Hydril agreement expected to generate $400M

GE Oil & Gas, a GE business, announced on January 28 that it has entered into an agreement to acquire the Hydril Pressure Control business from Tenaris.

Upon completion, the acquisition will expand GE’s Oil & Gas portfolio and complement VetcoGray’s Capital Drilling Equipment business. The closing of the transaction, which is subject to conditions including the receipt of governmental and regulatory approvals, is expected in the upcoming months.

Hydril’s Pressure Control business is one of the world’s leading suppliers of pressure control equipment used in the oil and gas drilling industry, with a special focus on deep and ultra-deepwater applications. Its product line includes Blowout Preventer (BOP) systems, parts, and repair and field services to maintain its installed base of products.

The business, which is expected to generate over $400M of sales in 2008, is headquartered in Houston, Texas and employs over 750 people globally.

“This is another major step for GE Oil & Gas. This acquisition will expand our existing range of products and services and allows us to provide a broader offering of Capital Drilling Equipment to the increasingly complex offshore industry,” said Claudi Santiago, president & CEO, GE Oil & Gas. “Hydril has an outstanding reputation for quality and reliability, with an extraordinary track record built over more than seventy years serving the oil and gas industry. This, combined with VetcoGray’s industry know-how and technology recognition, will accelerate the GE Oil & Gas presence in the fast growing deep water drilling industry.”

Paolo Rocca, chairman and CEO of Tenaris, commented, “The Hydril pressure control business is one with excellent technology, an impressive team and solid prospects but has limited synergies with our core tubular business. We believe that its opportunities will be enhanced within GE, as part of its growing Oil & Gas business, and that this transaction is in the best interests of its employees and customers and our shareholders.”

About GE's Oil & Gas business
GE's Oil & Gas business (www.ge.com/oilandgas) is a world leader in advanced technology equipment and services for all segments of the global oil and gas industry. Based in Florence, Italy, the company offers complete solutions for production, LNG, transportation, storage, refineries, and petrochemicals, as well as pipeline integrity solutions including pipeline-related software and pipeline asset management. Through its recent acquisition of VetcoGray, GE Oil & Gas has added products, systems and services for drilling, completion and production within onshore, offshore and subsea applications.