CHX - Schlumberger Is Thinking 10 Years Ahead With The ChampionX Acquisition

2024-04-08 05:20:17 ET

Summary

• Schlumberger acquired ChampionX this past week, primarily for the latter's production chemicals business.
• The Company is getting the leading spot in a new market and a less risky cash flow stream.
• SLB is positioning for the 2030s when the E&P spending is expected to transition from new development (capex) to more production optimization (opex).

Investment Thesis

Schlumberger Limited ( SLB ) announced this past Tuesday it would acquire ChampionX ( CHX ) in an all-stock deal valued at $8 billion; this is quite a significant transaction even for a behemoth like SLB as post-close, the ChampionX shareholders will control 9% of the combined company....

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