US: DOJ files antitrust lawsuit against Halliburton

The Justice Department on Wednesday sued to stop Halliburton Co. from acquiring oilfield services rival Baker Hughes Inc., saying the deal would eliminate head-to-head competition and harm consumers.

The proposed transaction, valued at nearly $35 billion, would combine two of the world’s three leading providers of those services to oil and gas companies and create a bigger rival to the industry leader, Schlumberger Ltd.

The Justice Department said in its complaint that the proposed consolidation would lead to higher prices and stifle innovation in an industry that fiercely competes for the business of exploration and production companies and to develop technologies for deeper drilling.

“The U.S. economy, American consumers and those who engage in the production of energy consumed in the United States cannot be asked to accept the risk to competition posed by this transaction,” the complaint said.

The deal would harm competition in 23 separate markets, creating “non-competitive duopolies,” Atty. Gen. Loretta Lynch said in a conference call with reporters.

Halliburton and Baker Hughes announced their plan to combine in November 2014, shortly after oil prices began to fall. Few, however, predicted the depth and duration of lower prices caused by a global oversupply of oil.

Full content: LATimes

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