February 22, 2010 2:46 PM

Wachtell, Baker Botts on $11 Billion Oil Deal

Posted by D.M. Levine

On Sunday, international oil services company Schlumberger LTD., announced plans to merge with Houston-based Smith International--a supplier of oil exploration and production equipment. If approved, the $11 billion dollar purchase would bring Schlumberger - already the biggest oilfield services company in the world - revenues twice as high as its chief competitor Halliburton Co., according to The Wall Street Journal.

Goldman Sachs & Co. served as Schlumberger's financial adviser on the deal--under which Schlumberger will buy Smith for roughly $45.84 per share--and Baker Botts acted as legal counsel, according to Schlumberger's announcement. Smith, meanwhile, was represented by UBS Investment Bank and Wachtell, Lipton, Rosen & Katz.

“Increased levels of drilling are required to sustain and increase world oil and gas production. Increasingly, those wells are being drilled in more challenging environments and in new resource plays," Schlumberger chairman and CEO Andrew Gould said in a statement. “We believe this transaction brings significant benefits to the customers and shareholders of both companies, and we look forward to welcoming Smith employees to Schlumberger.”

The statement also quoted Smith CEO John Yearwood as saying “Schlumberger offers Smith’s various segments enhanced engineering and design capability to place our products and expertise at the center of the total drilling system of the future. We look forward to a successful combination.”

Wachtell partners Daniel A. Neff, David E. Shapiro, Joseph D. Larson, Michael J. Segal, David Kahan, Jodi J. Schwartz, T. Eiko Strange, and associates Donju Song, Jenna E. Levine, and Christina Cheng worked on the deal for Smith. Baker Botts partners David Kirkland, Breen Haire, Tull Florey, Benjamin Wells, Derek Green, Rob Fowler, Aileen Hooks, and Paul Luther worked on the deal for Schlumberger.

Baker Botts declined to comment for this story. Wachtell, Lipton, Rosen & Katz did not immediately offer comment on the deal. 

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