| Siemens Agrees to Buy Dresser-Rand, an Oil Services Company, for $7.6 Billion
By David Gelles
DealBook
New York Times
September 21, 2014 10:23 pm
Siemens, the German engineering conglomerate, announced late Sunday a deal for the Dresser-Rand Group, an oil products and services company.
The deal, worth about $7.6 billion, including the assumption of debt, gives Siemens prominence in the American energy sector, which is booming as new reserves of oil and natural gas are tapped through unconventional drilling techniques.
Dresser-Rand has been fielding inquiries from potential buyers in recent months and hired advisers to vet the bids. But Siemens beat out other suitors with an all-cash bid of $83 a share.
“Dresser-Rand is a perfect fit for the Siemens portfolio,” said Joe Kaeser, chief executive of Siemens.
He added, “With this, Dresser-Rand will become the oil and gas company within Siemens.”
Other companies that had been pursuing a deal included Sulzer, the Swiss pump maker, which acknowledged it was in talks with Dresser-Rand last week. General Electric was reported to be considering a bid for Dresser-Rand as well, but people briefed on G.E.’s plans said the company was never in serious discussions about making an offer.
Winning the bidding war for Dresser-Rand would be a win for Mr. Kaeser. This summer, Siemens lost out to G.E. for the energy assets being sold by Alstom, the French industrial group. Siemens already makes some products and equipment for the United States energy sector, including a range of gas turbines.
But in acquiring Dresser-Rand, based in Houston, Siemens is expanding its exposure to the industry as technology for the extraction method called hydraulic fracturing, or fracking, opens huge swaths of land to drilling.
Siemens, with a market value of nearly $85 billion, is a vastly larger company than Dresser-Rand, whose products it will sell through its sales operation.
In a separate deal also announced Sunday, Siemens will sell its 50 percent stake in a household appliances joint venture with Robert Bosch GmbH for 3 billion euros ($3.85 billion).
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