Services giant Halliburton agreed Monday to buy rival firm Baker Hughes for $34.6 billion in cash and stock.
Halliburton agreed to pay $78.62 per Baker Hughes share.
Baker Hughes shareholders will receive 1.12 Halliburton shares plus $19 in cash for each share held.
Halliburton intends to finance the cash portion of the acquisition through a combination of cash on hand and fully committed debt financing.
Analysts have speculated the deal could raise antitrust concerns.
Halliburton said it is prepared to divest from businesses that generate a combined $7.5 billion per year, although it expects regulators will require “significantly less” divestment.
The company has also agreed to pay a $3.5 billion fee if the transaction fails to win regulatory approval.
The deal will make the newly merged firm more competitive with services market leader Schlumberger.
The combined companies had a pro-forma 2013 revenue of $51.8 billion, beating Houston-based Schlumberger’s $45.3 billion in revenue.
Houston-based Halliburton said it expects the merger to save the company nearly $2 billion per year.
Halliburton CEO Dave Lesar will head the new firm and the board of directors will be expanded to 15 members, with three members coming from the Baker Hughes board.
The combined company will operate under the Halliburton name and trade under the New York Stock Exchange ticker symbol “HAL.”
The deal is still subject to shareholder and regulatory approval.