Moody's Places Cameron (CAM) on Review for Upgrade (SLB)

Moody's Investors Service (Moody's) placed the Baa1 senior unsecured ratings of Cameron (NYSE: CAM) (Cameron) under review for upgrade following the announcement of a definitive agreement to be acquired by Schlumberger Limited (Schlumberger, Aa3 stable) in a stock and cash transaction valued at $14.8 billion. The review for upgrade is based on the potential benefit of Cameron's debt being supported by the stronger credit profile and greater financial flexibility of Schlumberger.

On Review for Upgrade:

..Issuer: Cameron International Corporation

....Senior Unsecured Commercial Paper, Placed on Review for Upgrade, currently P-2

....Senior Unsecured Regular Bond/Debenture, Placed on Review for Upgrade, currently Baa1

Outlook Actions:

..Issuer: Cameron International Corporation

....Outlook, Changed To Rating Under Review From Stable

RATINGS RATIONALE

Under the agreement announced on August 26, 2015, Cameron shareholders will receive 0.716 shares of Schlumberger common stock and a cash payment of $14.44 in exchange for each Cameron share. Following the transaction, the shareholders of Cameron are expected to own approximately 10% of the outstanding shares of Schlumberger. The ratings review will focus on whether or not the Cameron debt is legally assumed or guaranteed by Schlumberger or its rated subsidiaries.

If Cameron's debt is guaranteed by Schlumberger or its rated subsidiaries, Cameron's unsecured notes would likely be upgraded to the same rating as Schlumberger or its rated subsidiaries. Otherwise, the possible ratings uplift will depend on our view of Schlumberger's level of support for Cameron, Cameron's strategic importance to Schlumberger and the notes' structural position in the combined company's pro forma capital structure. Without a guarantee, Cameron's rating will likely not be equalized with Schlumberger's rating or its rated subsidiaries.

If Cameron is an unguaranteed subsidiary of Schlumberger following the acquisition, then continued stand-alone financial reporting by Cameron, including annual audited financial statements, will be required in order for Moody's to maintain a rating.

The completion of the transaction is subject to the approval of Cameron shareholders as well as certain regulatory approvals and other customary closing conditions. The review will conclude once the acquisition closes, anticipated in the first quarter of 2016.

The principal methodology used in these ratings was Global Oilfield Services Industry Rating Methodology published in December 2014. Please see the Credit Policy page on www.moodys.com for a copy of this methodology.

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