Jan 25 (Reuters) - Halliburton Co, which is awaiting regulatory approval for its acquisition of Baker Hughes Inc , said it was yet to reach an agreement with U.S. and European regulators about the "adequacy" of proposed divestitures.
Halliburton presented "an enhanced set of proposed divestitures" to the U.S. Department of Justice earlier this month, CEO Dave Lesar said on a post-earnings call.
The company reported a better-than-expected profit on Monday as deep cost cuts helped offset a drop in drilling activity.
Halliburton has also informally notified the European Commission and other jurisdictions of the new sale plan, Lesar said on the call.
He did not specify what the company would divest, but said Halliburton was in talks with interested buyers.
Halliburton and Baker Hughes have so far disclosed plans to divest overlapping businesses, with combined 2013 revenue of $5.2 billion, to address concerns that their deal would lead to higher prices and less innovation.
Total divestitures could be as much as $10 billion on a 2013 basis, according to Evercore ISI analyst James West.
Still, it is "positive" that the DOJ has not tried to block the merger, West said.
Some other analysts were more skeptical.
"We are not as favorable on the timing and the potential for (the deal) to go through as we were previously," said Edward Jones analyst Rob Desai.
Baker Hughes and Halliburton have extended the deadline for closing the deal - first announced in November 2014 - to April 30.
Lesar said on Monday the merger agreement would not automatically terminate even if regulatory approvals do not come in by April 30.
Both companies may continue to seek regulatory approval, or either company may terminate the deal, he said.
Excluding an impairment charge and costs related to the pending merger, Halliburton earned 31 cents per share in the fourth quarter, beating analysts' average estimate of 24 cents, according to Thomson Reuters I/B/E/S.
Cost cuts - including 4,000 layoffs in the fourth quarter - and a spike in completion tool sales in the Gulf of Mexico drove the earnings beat.
Halliburton has reduced its global headcount by 25 percent, or almost 22,000 employees, since 2014, spokeswoman Emily Mir said in an email.
Fourth-quarter revenue fell 42 percent to $5.08 billion, missing analysts' estimates of $5.11 billion.
Halliburton shares were nearly unchanged at $30.19 in morning trade on Monday, while Baker Hughes' stock was down nearly 2 percent at $41.27.
(Reporting by Swetha Gopinath and Amrutha Gayathri in Bengaluru; Editing by Shounak Dasgupta)
Copyright 2016 Thomson Reuters. Click for Restrictions.
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Most Popular Articles
From the Career Center
Jobs that may interest you