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DOJ review of Halliburton and Baker Hughes deal extended

The mega-merger between the world’s second and third largest oil field service companies will grant U.S. antitrust regulators additional time to review the deal.

The two companies, Halliburton and Baker Hughes, have entered into a timing agreement with the Antitrust Division of the U.S. Department of Justice (DOJ). The review process of the merger, valued at $34.6 billion, will be extended until at least November 25, or 90 days after the two companies are found to be in compliance with the DOJ’s second request to review the deal.

Both Halliburton and Baker Hughes expect to certify substantial compliance with the second requests by mid-summer. In addition to the timing agreement, the companies have agreed to extend the timeframe for closing the merger to no later than December 1, 2015. Timing agreements are generally made involving large and complex business deals and provide the DOJ extra time to review responses to its second requests.

In a statement made last week, the companies said, “The parties will continue to work constructively with all competition enforcement authorities that have expressed an interest in the proposed transaction.” Halliburton and Baker Hughes will continue communications with the DOJ, the European Commission and other competition enforcement authorities in regards to the acquisition.

In addition to the merger, Halliburton is in the process of marketing the sale of its Fixed Cutter and Roller Cone Drill Bits, Directional Drilling, Logging-While-Drilling and Measurement-While-Drilling businesses. Also, Halliburton has announced plans to divest additional businesses associated with the company, pending approval from competition enforcement authorities. To date, however, there is no agreement with any enforcement authorities as to the adequacy of these proposals.

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