Merger talks between Halliburton and Baker Hughes stalled yesterday with the companies still haggling over price and divestiture concerns, people with knowledge of the matter said.

Halliburton could make an unsolicited tender offer for Baker Hughes instead, and nominate a slate of directors to the target’s board, three of the people said, asking not to be identified discussing private information. Alternatively, the companies may still be able to revive the negotiations, one person said.

Baker Hughes fell about 3% after the close of regular trading, to $58.10 a share as of 5:26 p.m. in New York. Halliburton fell to $54.53 after closing at $55.08 apiece.

Baker Hughes, based in Houston, said yesterday that companies are in talks. Ahead of the disclosure, a person with knowledge of the matter had said a deal could come as soon as Monday.

Since then, the two sides have become stuck on disagreements about the deal’s price and the billions of dollars in assets that would have to be sold for the deal to pass antitrust scrutiny, one of the people said. Combining the world’s second- and third-largest oilfield service providers will draw scrutiny from antitrust regulators.

The companies may have to sell $7.5 billion to $10 billion in assets to address regulator concerns, two people said. They generated a combined $55.5 billion of sales in the twelve months through September, data compiled by news outlet Bloomberg show.

If the deal went ahead it would create a company with 140,000 employees.

Full Article: Bloomberg