The unexpected takeover of Chart Industries by Baker Hughes illustrates how energy sectors are moving closer together in an age of decarbonisation, technological change and increasing competition.
That’s the view of gasworld Content Director Rob Cockerill, speaking on the latest 1895 podcast, reflecting on the biggest news of the week, and one of the biggest stories this year.
“It feels there is a middle ground where everyone is coming together,” he said, echoing comments made in a column published shortly after the news broke.
“This is all about how two sectors are coming together, in terms of oil and gas services [Baker Hughes] and cryogenics and gas handling [Chart]. Will we see more acquisitions? It could be uncomfortable reading for traditional executives in the industrial gas sector but that could be what happens next.
“We have this whole decarbonisation and sustainability play: how best to extract existing oil and gas resources, and the technologies to handle existing and new energy molecules. It positions Baker Hughes perfectly – and for Chart it should open up … new opportunities.”
Cockerill and colleague Tom Dee reflect this week on a tumultuous period in which Chart and Flowserve announced a ‘merger of equals’ in June, only for Baker Hughes to come with its offer on 29 July.
“It caught everyone by surprise. From what I understand there were many more suitors for Chart – it’s a company in demand,” said Cockerill.
“Chart has been on a transformation [journey] since Jill Evanko became CEO in 2018. They’ve [made] acquisitions in key markets, and they had the huge purchase of Howden, a $4.4bn deal, two years ago. Under her leadership, Chart has been strongly positioned in LNG and hydrogen.”
He added that while Chart’s shareholders should all prosper in the short term under the terms of the deal, “I think it’s the bigger picture that’s important – Chart now becomes part of Baker Hughes, a $40bn global oil and gas group,” he said.
To listen to the podcast, click here.