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Tenaris buys oil-field gear firm for $2.4 billion

/ Source: The Associated Press

Luxembourg-based Tenaris SA agreed to acquire Maverick Tube Corp., a fellow maker of tube products for the energy industry, for $65 a share, amid high demand for equipment in the oil patch.

Based on Maverick's 36.9 million shares outstanding as of May 5, the deal values the Chesterfield, Missouri, company at about $2.4 billion.

Maverick shares fell 4 percent, $1.92, to close at $45.66 Monday on the New York Stock Exchange.

Tenaris said it will finance the acquisition through cash on hand and debt. The transaction is subject to regulatory approvals and other conditions.

Maverick produces oil-field tubular goods like line pipe and coiled tubing for use in oil and natural-gas extraction. Prices for oil-field equipment have surged amid higher prices for crude oil and natural gas and the resulting increase in exploration and production activity.

Maverick has about 4,650 workers and posted 2005 sales of $1.8 billion (euro1.43 billion). The combined entity, if the deal is completed, would have annual sales of about $9 billion (euro7.16 billion). Of that, about 30 percent would come from the United States and Canada.