US manufacturing giant General Electric has agreed to merge its oil and gas division with an oilfield services firm.
The deal signed with Baker Hughes seeks to create a new “world-leading” oilfield services company.
Under the terms of the deal, GE will contribute $7.4 billion (£6.06bn) to fund the $17.50 (£14.35) per share special dividend to existing Baker Hughes shareholders.
It will own 62.5% of the merged company, while Baker Hughes shareholders will own the rest.
The new company is expected to have annual revenues of $32 billion (£26bn) and have operations in more than 120 countries.
Jeff Immelt, Chairman and Chief Executive Officer of GE said: “This transaction creates an industry leader, one that is ideally positioned to grow in any market. Oil and gas customers demand more productive solutions. This can only be achieved through technical innovation and service execution, the hallmarks of GE and Baker Hughe.”