GE’s energy unit agreed to merge with Baker Hughes today and Rio Tinto has given up on its long-stalled Guinean iron ore project.
GE and Baker Hughes Agree to Merge
The oil and gas business of General Electric will be merged into Baker Hughes to create an oil field technology company that boasts more than $32 billion in combined revenue and operates in more than 120 countries, the companies said Monday.
GE will contribute its oil-and-gas business and $7.4 billion through a special one-time cash dividend of $17.50 for each Baker Hughes share. The new company will be publicly traded on the New York Stock Exchange and will be 62.5% owned by GE and 37.5% owned by Baker Hughes shareholders if it passes regulatory scrutiny.
Rio Tinto Will Quit Guinea Iron Ore Project
Rio Tinto has signed a preliminary deal to sell its stake in Guinea’s Simandou project to Chinalco, it said on Friday, injecting impetus into the long-stalled plan to develop the world’s largest untapped iron ore reserves.
For all the project’s potential, mining company Rio has voiced frustration over the difficulty of drumming up financing and industry sources said the agreement could open the door to Chinese funding.