National Oilwell Varco, Inc. and Robbins & Myers have entered into an agreement under which National Oilwell Varco will acquire Robbins & Myers, Inc. (NYSE:RBN) in an all cash transaction that values Robbins & Myers at approximately $2.5 billion.
Under the agreement, Robbins & Myers’ shareholders will receive $60.00 per share in cash in return for each of the approximately 42.4 million shares outstanding (“the Transaction”.) The Boards of Directors of National Oilwell Varco and Robbins & Myers have unanimously approved the transaction, which is subject to customary closing conditions, including the approval of two-thirds of Robbins & Myers shareholders. Closing would be expected to occur in the fourth quarter of calendar 2012.
Robbins & Myers’ largest shareholder, M.H.M. & Co., Ltd, which owns approximately 10% of the outstanding common shares of Robbins & Myers (“Common Stock”) has agreed to vote its Common Stock in favor of the Transaction in accordance with the terms of a support agreement entered into in respect of the Transaction. The support agreement will terminate in the event the merger agreement is terminated in accordance with recommendation of the Board of Robbins & Myers.
Mr. Pete Miller, Chairman, President and CEO of National Oilwell Varco, remarked, “Robbins & Myers has many complementary products with those National Oilwell Varco currently offers the industry. I am particularly enthusiastic about the prospect of incorporating their downhole tools, pumps and valves into National Oilwell Varco Petroleum Services & Supplies and Distribution & Transmission segments. We feel that our combined manufacturing infrastructure and portfolios of technology will further advance our presence in the oil and gas markets we serve. We are extremely excited about this combination and look forward to welcoming a very talented group of employees into the National Oilwell Varco family.”
Mr. Pete Wallace, President and Chief Executive Officer of Robbins & Myers commented, “Robbins & Myers Board of Directors believes that the proposed transaction with National Oilwell Varco represents a compelling value for our shareholders. This transaction allows Robbins & Myers to join forces with an industry leader that will enable its business segments to fully capitalize on their respective strategies, enhance leadership positions in niche applications, and execute growth plans at a faster pace. We have worked hard to create a focused business with reduced complexity and a culture of continuous improvement, all based on improving customer productivity and profitability. This is the right time for this transaction and I believe National Oilwell Varco is the right partner to take us to the next level of performance.”
National Oilwell Varco is a worldwide leader in the design, manufacture and sale of equipment and components used in oil and gas drilling and production operations, the provision of oilfield services, and supply chain integration services to the upstream oil and gas industry.
Robbins & Myers, Inc., headquartered in Houston, TX, is a leading supplier of engineered, application-critical equipment and systems for global energy, chemical and other industrial markets. The company provides products and services for upstream oil and gas markets, along with a portfolio of industrial process and flow control products. Robbins & Myers has 3,400 employees and operates in 15 countries.
- National Oilwell Varco profits leap on petroleum supplies sales (bizjournals.com)
- Analyst Ratings Update for National Oilwell Varco (forbes.com)
Regional security expert Dr Theodore Karasik says contingencies are in place should Iran follow through with threat to close Strait of Hormuz
World powers have started drawing up contingency plans in case Iran follows through with its threat to seal off the vital Strait of Hormuz.
Iranian officials have threatened to block the waterway if new sanctions, aimed at discouraging Iran’s nuclear programme, harm Tehran’s oil exports.
Tehran has announced plans for military exercises in the strait, the world’s most vital oil lane with 16 million barrels of crude passing through it every day. Gulf oil producers are now working with the West on a plan to keep supplies steady if Iran follows through with its threat. Regional security expert Dr Theodore Karasik said: “In the past Iran has made threats of closure but given the current environment the threats are being taken more seriously. All sides are preparing for the potential that Iran would launch this as an opening salvo to a much wider confrontation.”
Karasik, director of research and development at the Institute for Near and Gulf Military Analysis, added that Tehran’s latest threat to blockade the waterway showed it “acting in a more assertive, almost belligerent way”. Reuters reported that a new oil pipeline stretching from Abu Dhabi to Fujairah could be used to transport crude outside of the Gulf, allowing it to be loaded onto tankers waiting on Fujairah’s Indian Ocean coastline.
Last month UAE energy minister Mohammad bin Dha’en Al Hameli said the strategic pipeline would be ready “soon”, and Reuters quoted one industry source as saying: “It’s now only a matter of pushing a button.” However, Karasik said that any use of the UAE pipeline, and a similar plan to shift some of Saudi Arabia’s oil to its Red Sea coast, would not compensate for a full closure of the strait.
“The creation of these alternative routes is part of a strategy to have less of a reliance on the strait itself, but these lines are not mature enough to offset the potential losses,” he said. Britain also said yesterday it was sending its newest warship – Royal Navy destroyer HMS Daring – to the Gulf.
“The rhetoric has reached such a feverish pitch now that you have to take every word that is being said as being serious, and there is too much movement ongoing now in terms of military exercises and manoeuvres to rule that this is a normal situation,” said Karasik.
- US, Israel to “challenge” Iran (mb50.wordpress.com)
- The Geo-Politics of the Strait of Hormuz: Could the U.S. Navy be defeated by Iran in the Persian Gulf? (irannewpearlharbour.wordpress.com)
- Report: Iran begins uranium enrichment at new site (sfgate.com)
- Here They Go Again: Iran Threats To Shut Down Straight Of Hormuz (businessinsider.com)
- Iran Military Leader Says They Will Close Oil Strait If Oil Exports Blocked (foxnews.com)
- Iran says it will close Strait of Hormuz if crude exports blocked (rt.com)
- Report: Iran begins uranium enrichment at new site (seattlepi.com)