HARDLY CRUDE: The merger of a major Houston oil company with GE has been finalized

The Baker Hughes logo appears above the post where it trades, on the floor of the New York Stock Exchange, Monday, Oct. 31, 2016. General Electric announced it would merge its oil and gas division with Baker Hughes, creating a new company with $32 billion in revenue a year. (AP Photo/Richard Drew)

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Yesterday, the merger between Houston-based Baker Hughes with the oil and gas division of GE was finalized in a $23 billion deal.

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The merger means the new business, with Baker Hughes, a GE company, becoming the second-largest oil-field services operator in the world.

Lorenzo Simonelli, the former chief executive of GE Oil & Gas and new chief of Baker Hughes GE, told the Houston Chronicle “the combination will join Baker Hughes’ oil field expertise with GE’s industrial computing power and transform the industry.”

He further said the new company will have the capacity to expand into all parts of the oil and gas business.

That said, lucrative as the profits are expected to be as a result of the transaction, the company plans to cut $1.2 billion out of its combined expenses by 2020, including closing some of the 40 facilities in Houston.

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The new company will have headquarters in Houston and London.

What do you think?

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