Weatherford International PLC (NYSE:WFT) has finally agreed to sell its laboratory services. The Swiss oilfield services company has been toiling with the sale idea for the longest according to inside sources. However, according to a press release, it has brokered a deal worth $205 million with an entity led by Houston’s CSL Capital Management. The sale deal will tap onto among other things Weatherford’s laboratory and geological analysis business.
WFT is based in Switzerland even though has its main U.S. office in Houston. In the recent past, it has been struggling with financial debts, a situation, which has exclusively affected its operations. The situation has also nailed the company’s ability to confidently remain in the competitive global oilfield services market.
But the two companies will continue serving their joint customers
Each of the two companies has their unique strengths when it comes to serving their customers. Alongside equipment and technology, Weatherford provides a variety of services in the drilling and oil production sectors. On the other hand, CSL Capital, which is a private equity firm has its focus on energy. This explains that they still need each other.
That said, the duo has confirmed that it will continue holding onto its collaborative relationship even after the conclusion of the deal. They will tap into each other’s expertise as they both seek to grow and invest in their respective businesses.
Weatherford is planning to refocus its portfolio
Weatherford has a well – defined vision. Apart from the sale of the lab unit that the company will also be disposing of its onshore rig business. Two potential buyers have reportedly expressed their interest but they have not concluded yet. On the other hand, the company says it is expecting to generate about $500 million from two other two divestiture projects.
Meanwhile, inside sources have revealed that the current deal is likely to conclude as the year comes to an end. Along with this, president and CEO of Weatherford, Mark McCollum, says, “We are happy to have signed an agreement with a group led by CSL Capital Management, who has a strong track record of investing in upstream oilfield services.”