General Electric to buy Cameron's reciprocating compression unit for $550 mn
21 January 2014
General Electric Co (GE) yesterday struck a deal to buy Cameron International Corp's reciprocating compression division for $550 million in order to take advantage of the boom in North American shale oil and gas processing business.
The division provides reciprocating compression equipment and aftermarket parts and services for oil and gas production, gas processing, gas distribution and independent power industries.
Cameron's Reciprocating Compression division, which generated sales of approximately $355 million in 2012, has around 900 employees and operates from 20 global locations.
Post closing, Cameron's Reciprocating Compression division will become part of GE's Oil and Gas' recently formed downstream technology solutions unit, which serves the $11-billion downstream and distributed gas segments.
The acquisition complements GE's Oil & Gas' existing high-speed reciprocating business, which focuses in low horsepower units that are used predominantly in gas lift applications and will also complement GE's business by adding higher horsepower models used in gas gathering, processing and transmission.
High-speed reciprocating compressors are used in several applications from gas gathering, gas lift and injection, as well as transmission and storage and the development of shale oil and gas fields, particularly in North America, has increased demand for high-speed reciprocating compressors.
Lorenzo Simonelli, president and CEO of GE Oil & Gas, said, ''Our increased strategic focus, the buoyant oil and gas sector and our track record in providing high-quality support to customers combined with Cameron's Reciprocating Compression division will position us for accelerated growth.''