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Schlumberger agreed on Wednesday to acquire Houston-based equipment firm Cameron in a stock and cash transaction worth about $14.8 billion.

Under the terms of the agreement, Cameron shareholders will receive 0.716 shares of Schlumberger common stock and a cash payment of $14.44 in exchange for each Cameron share.

Based on the closing stock prices of both companies on August 25, 2015, the agreement places a value of $66.36 per Cameron share, a 37 percent premium to Cameron’s 20-day volume weighted average price of $48.45 per share, and a 56.3 percent premium to Cameron’s most recent closing stock price of $42.47 per share.

Upon closing, Cameron shareholders will own about 10 percent of Schlumberger’s outstanding shares of common stock.

Houston-based Schlumberger expects to realize pretax synergies of $300 million in the first year and $600 million in the second year after the acquisition.

“Initially, the synergies are primarily related to reducing operating costs, streamlining supply chains, and improving manufacturing processes, with a growing component of revenue synergies in the second year and beyond,” Cameron said.

Schlumberger also expects the combination to be accretive to earnings per share by the end of the first year after closing.

On a pro forma basis, the combined company had 2014 revenues of $59 billion.

The agreement was unanimously approved by the boards of directors of both companies.

The transaction is subject to Cameron shareholders’ approval, regulatory approvals and other customary closing conditions.

The deal is expected to close in the first quarter of 2016.

“This agreement with Cameron opens new and broader opportunities for Schlumberger….With oil prices now at lower levels, oilfield services companies that deliver innovative technology and greater integration while improving efficiency, which our customers increasingly demand, will outperform the market,” Schlumberger chairman and CEO Paal Kibsgaard said.

Goldman, Sachs & Co. is acting as financial advisor, and Baker Botts LLP and Gibson Dunn & Crutcher LLP are serving as legal counsel, to Schlumberger.

Credit Suisse is acting as financial advisor and Cravath, Swaine & Moore LLP is serving as legal counsel to Cameron.

Cameron is a provider of flow equipment products, systems and services to worldwide oil and gas industries.

The company employs over 24,000 full-time personnel and operates in more than 300 locations around the world.