Oil drilling equipment maker
Cameron International Corp.
) recently closed the acquisition of TTS Energy Division from TTS
Group ASA for a cash payment of $270 million. The deal was
announced in mid-April.
The TTS Energy Division is engaged with the supply of high
quality drilling equipment, rig packages and rig solutions for both
jackup and onshore rigs to customers across the globe.
The division's products comprise drilling rig control systems,
top drives, traveling blocks, automated pipe handling along with
iron rough necks, drawworks, derrick structures, drill floor tools,
fingerboards, blowout preventer (BOP) handling equipment, deadline
anchors, and drill line spoolers.
Cameron management remains highly upbeat regarding this takeover
and believes that TTS product line will complement the company's
existing portfolio of goods and service offerings.
Of late, Cameron has adopted the strategy of purchasing
attractive business units that are capable to delivering long-term
benefits. In August, last year, Cameron acquired LeTourneau
Technologies Drillings Systems and Offshore Products divisions from
Joy Global Inc.
) for $375 million.
Houston, Texas-based Cameron is a leading manufacturer of
pressure control equipment used in onshore, offshore, and subsea
applications for oil and gas drilling, production, and
transmission. The company operates through three segments: Drilling
& Production Systems; Valves & Measurement; and Process
& Compression Systems.
Cameron currently retains a Zacks #3 Rank, which translates into
a short-term Hold rating. For the longer term, we are maintaining
our Neutral recommendation on the stock.
We like Cameron's diversified product portfolio, specialty
service capabilities and proprietary technological expertise. Other
positives for Cameron include a strong backlog, growing
international operations and a favorable outlook for subsea
However, shares of the company are fairly valued at the current
level, considering the sensitivity of Cameron's business to gas/oil
price volatility, as well as exploration and production spending
patterns, costs, geo-political risks, competition and the advent of
CAMERON INTL (CAM): Free Stock Analysis Report
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