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Here is an excerpt from a Business Week Article on BHI:

<<Whispers are that Schlumberger (SLB), the world leader in oil-and-gas drilling services, is poised to go after Baker Hughes (BHI), the world's largest maker of drill bits, whose 1997 sales totaled $3.7 billion. Schlumberger's sales of more than $10 billion would be dwarfed by the combined $16.2 billion sales of the Halliburton-Dresser duo.

A New York hedge-fund manager insits that Schlumberger has twice approached Baker Hughes last year with an offer.... He figures that in a buyout, Baker is worth $55 per share.>>

The hedge-fund manager goes on to say that he believes Schlumberger will not be content to be relegated to #2 status and will therefore acquire someone. I still think Schlumberger may have trouble acquiring BHI due to FTC implications. I also suspect that any acquisition would leave out parts of BHI such as its process equipment groups and its chemical business.



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