The UK’s Competition and Markets Authority (CMA) has initiated an investigation into the proposed $8bn acquisition of ChampionX by oilfield services giant SLB, reported Reuters.
The authority is scrutinising the deal, announced last April, for potential competition issues in the UK markets.
The CMA has set a deadline of 27 March 2025 for its preliminary phase one decision, and SLB anticipates the acquisition will receive clearance by the first quarter of the year (Q1 2025).
ATB Capital Markets analysts have noted that the CMA’s deadline is subject to change.
The industry has seen a trend of delayed transactions due to antitrust regulators including the US Department of Justice requesting additional information since the start of a consolidation wave in 2023.
Last year, SLB and ChampionX received a second request from the US Department of Justice concerning their deal.
ATB Capital Markets’ analysts were quotes by the news agency as saying that: “With the timeline announced by CMA, there is a risk that should the CMA launch a Phase 2 investigation, the merger timing could be delayed.”
SLB signed a definitive agreement in April 2024 to acquire ChampionX in an all-stock transaction. The deal received unanimous approval from ChampionX’s board of directors.
Under the deal, ChampionX shareholders were estimated to receive 0.735 shares of SLB common stock for each ChampionX share they hold, resulting in them owning approximately 9% of SLB’s outstanding shares upon completion.
In March 2024, ChampionX, the oilfield technology provider, announced a plan to acquire RMSpumptools for approximately £86m ($108.7m).
RMSpumptools specialises in wellhead electrical penetrator and mechanical connector systems, completion systems, intervention tools and subsea connector systems for the oil and gas industry.
