Image courtesy of Eurasia Drilling Company.

Services giant Schlumberger bought a 45.6 percent stake Tuesday in Russian services player Eurasia Drilling Company for $1.7 billion despite western sanctions and a weak rubble.

Houston-based Schlumberger will pay $22 per Eurasia share with a call option to purchase the company’s remaining shares during a two year period that starts three years after the deal closes.

The two companies currently work together under a strategic alliance agreement signed in 2011.

As part of the deal Eurasia will go private and be de-listed from the London Stock Exchange before the purchase is complete.

Eurasia will offer its other shareholders $22 per share to de-list the company, an 81 percent premium over Monday’s closing price.

The transaction is expected to close during the first quarter of 2015.

Eurasia is the largest provider of onshore drilling services in Russia, as measured by the number of meters drilled, and provides onshore and offshore services in Russia, the Caspian Sea and Iraq.

The services company is currently locked in a pricing dispute with Russia’s Rosneft that spurred Rosneft to cut down the number Eurasia rigs it employees.


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