Siemens is acquiring Dresser-Rand in a $7.6bn (£4.6bn) cash deal which will help the German conglomerate boost its oil and gas business in North America.
The American firm makes oilfield equipment, and under the deal, it will become “the platform for oil and gas equipment solutions within Siemens.”
The German firm said its $83-a-share bid has been unanimously supported by Dresser-Rand’s board of directors.
Siemens is hopeful the transaction will complete by next summer.
The acquisition is subject to approval by Dresser-Rand shareholders, as well as regulatory approvals in Europe and the US.
The deal gives Siemens access to the US oil industry at a time when a drilling boom for oil in North America has led to higher demand for energy services and equipment.
Siemens – Europe’s largest engineering company – “plans to operate Dresser-Rand as the company’s oil and gas business retaining the Dresser-Rand brand name and its executive leadership team”, a statement issued by Dresser-Rand says.
“In addition, Siemens intends to maintain a significant presence in Houston, which will be the headquarters location of the oil and gas business of Siemens.”
Also in the statement, Lisa Davis, a member of the Managing Board of Siemens added: “Our aim is to become the leading rotating equipment and process system integrator for the oil and gas industry. Dresser-Rand has strong presence in oil and gas, a reputation for technology leadership and innovation, and a talented and experienced leadership team.
“Our intention is to leverage these strengths by maintaining the existing company and brand name and selectively moving complementary products and services from the existing Siemens portfolio into Dresser-Rand, enabling us to offer a much broader range of products, services and solutions to meet our customers’ needs.”
Dresser-Rand ranks among the world’s largest suppliers of rotating equipment solutions to the global oil, gas, petrochemical and process industries.
The Houston-based firm has manufacturing facilities in France, United Kingdom, Spain, India and Brazil, as well as the US.
Siemens is widely known as a global leader in electronics and electrical engineering, with operations in the fields of industry, energy and healthcare. The conglomerate also provides infrastructure solutions, primarily for cities and metropolitan areas.