Siemens (SI) May Bid for Dresser-Rand (DRC) Following Lufkin/GE Deal
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Dresser-Rand (NYSE: DRC) is up on the session following reports that the company is becoming a ripe takeover target.
Bloomberg noted today that suitors to Dresser-Rand might include names like Cameron Int'l (NYSE: CAM), National Oilwell Varco (NYSE: NOV), and Siemens AG (NYSE: SI).
The move might be warranted; with energy demand increasing the need for Dresser-Rand's oil and gas extraction equipment, earnings are expected to rise 58 percent over the next three years, better than 86 percent of its peers.
Siemens is the most-likely given the recent $3.3 billion purchase of Lufkin Industries by peer General Electric (NYSE: GE). It would keep Siemens on a level playing field with GE.
One obstacle to over come would be Dresser-Rand CEO Vincent Volpe. Bloomberg noted the Volpe might have a large number in mind before taking a bid seriously and, given that one analyst firm sees $100 as a fair price for the company, Siemens, Cameron, or another buyer would have to pay-up to grab his attention. At $100, a takeover of Dresser-Rand would be the richest valuation for a oilfield machinery and equipment company with a market cap over $1 billion on record.
Shares are up 3.3 percent Tuesday.
Bloomberg noted today that suitors to Dresser-Rand might include names like Cameron Int'l (NYSE: CAM), National Oilwell Varco (NYSE: NOV), and Siemens AG (NYSE: SI).
The move might be warranted; with energy demand increasing the need for Dresser-Rand's oil and gas extraction equipment, earnings are expected to rise 58 percent over the next three years, better than 86 percent of its peers.
Siemens is the most-likely given the recent $3.3 billion purchase of Lufkin Industries by peer General Electric (NYSE: GE). It would keep Siemens on a level playing field with GE.
One obstacle to over come would be Dresser-Rand CEO Vincent Volpe. Bloomberg noted the Volpe might have a large number in mind before taking a bid seriously and, given that one analyst firm sees $100 as a fair price for the company, Siemens, Cameron, or another buyer would have to pay-up to grab his attention. At $100, a takeover of Dresser-Rand would be the richest valuation for a oilfield machinery and equipment company with a market cap over $1 billion on record.
Shares are up 3.3 percent Tuesday.
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