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Weatherford sells its engineered chemistry and drilling fluids businesses to Lubrizol

01st December 2014

Weatherford International has signed a definitive agreement with an affiliate of The Lubrizol Corporation, a Berkshire Hathaway company, for the sale of the company's engineered chemistry and integrity drilling fluids business

Weatherford sells its engineered chemistry and drilling fluids businesses to Lubrizol
Weatherford's engineered chemistry business provides chemical treatments for oil and gas production and produced waters as well as additives for drilling, workover and stimulation operations, while its integrity drilling fluids business includes drilling fluid systems and additives for enhanced performance of drilling operations

The businesses will be sold for USD 750m in cash, subject to customary purchase price adjustments, plus a potential increase of USD 75m for an earnout that is tied to the post-closing performance of the businesses.

Weatherford's engineered chemistry business provides chemical treatments for oil and gas production and produced waters as well as additives for drilling, workover and stimulation operations, while its integrity drilling fluids business includes drilling fluid systems and additives for enhanced performance of drilling operations.

The sale is subject to customary closing conditions and regulatory approvals and is expected to close before year end 2014. Proceeds from the sale will be used to pay down debt.

Bernard J. Duroc-Danner, chairman, president and chief executive officer of Weatherford stated: "The agreement is another step in Weatherford's previously announced plans to divest the company's non-core businesses.

“This transaction brings our realised cash divestiture proceeds to approximately USD 1.8bn during 2014 and implies that our net debt will range between USD 6.6bn to USD 6.8bn at year end 2014. This is substantial progress.

“These divested businesses represent attractive growth platforms for Lubrizol, a technology-driven specialty chemicals company with strong leadership and innovation. The transaction provides Lubrizol the opportunity to leverage Weatherford's oilfield engineered chemistry and fluid expertise to the benefit of its clients."

"I am very pleased with the growth prospects represented by this proposed acquisition" said James L. Hambrick, Lubrizol chairman, president and chief executive officer.  "For us, it is a decisive move into a large adjacent market space that, we believe, will value the combined technologies, fluid formulation capabilities and applications knowledge of our legacy and newly acquired businesses. We look forward to being an essential and valued solutions provider to multinational and regional oilfield service companies."

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