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Acquisitions | 12 Months Ended
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Dec. 31, 2018
Business Combinations [Abstract] |
Acquisitions | 4. Acquisitions Cameron On April 1, 2016, Schlumberger acquired all of the outstanding shares of Cameron, a leading provider of flow equipment products, systems and services to the oil and gas industry worldwide. Under the terms of the merger agreement, Cameron became a wholly-owned subsidiary of Schlumberger. Each share of Cameron common stock issued and outstanding immediately prior to the effective time of the merger was converted into the right to receive 0.716 shares of Schlumberger stock and $14.44 in cash. Calculation of Consideration Transferred The fair value of the consideration transferred to effect the acquisition of Cameron was as follows:
(stated in millions, except exchange ratio and per share amounts) |
Equity consideration: |  |  |  |  |  |  |
Number of shares of Cameron stock outstanding |  | 192 |  |  |  |
Exchange ratio |  | 0.716 |  |  |  |
Schlumberger shares of common stock issued |  |  | 138 |  |  |  |
Schlumberger closing stock share price on April 1, 2016 |  | $ | 72.12 |  |  |  |
Equity consideration |  |  |  |  | $ | 9,924 |
Cash consideration: |  |  |  |  |  |  |
Number of shares of Cameron stock outstanding |  | 192 |  |  |  |
Cash consideration per Cameron share |  | $ | 14.44 |  |  |  |
Cash consideration |  |  |  |  |  | 2,776 |
Other: |  |  |  |  |  |  |
Fair value of replacement equity awards |  |  |  |  | 103 |
Total fair value of the consideration transferred |  |  |  |  | $ | 12,803 |
Certain amounts reflect rounding adjustments Allocation of Consideration Transferred to Net Assets Acquired The following amounts represent the fair value of assets acquired and liabilities assumed in the merger.
(Stated in millions) |
Cash | $ | 785 |
Short-term investments |  | 1,448 |
Accounts receivable |  | 1,669 |
Inventories (1) |  | 2,350 |
Fixed assets |  | 1,320 |
Intangible assets: |  |  |
Customer relationships (weighted-average life of 25 years) |  | 2,371 |
Technology/Technical know-how (weighted-average life of 16 years) |  | 1,736 |
Tradenames (weighted-average life of 25 years) |  | 1,225 |
Other assets |  | 511 |
Accounts payable and accrued liabilities |  | (2,604 | )
Long-term debt (2) |  | (3,018 | )
Deferred taxes (3) |  | (1,343 | )
Other liabilities |  | (538 | )
Sub-total | $ | 5,912 |
Less: |  |  |
Investment in OneSubsea (4) |  | (2,065 | )
Noncontrolling interests |  | (57 | )
Total identifiable net assets | $ | 3,790 |
Goodwill (5) |  | 9,013 |
Total consideration transferred | $ | 12,803 |
(1) Schlumberger recorded an adjustment of $299 million to write-up the acquired inventory to its estimated fair value. Schlumberger’s 2016 Cost of sales reflected this increased valuation. (2) In connection with the merger, Schlumberger assumed all of the debt obligations of Cameron, including its $2.75 billion of fixed rate notes. Schlumberger recorded a $244 million adjustment to increase the carrying amount of these notes to their estimated fair value. This adjustment is being amortized as a reduction of interest expense over the remaining term of the respective obligations. (3) In connection with the acquisition accounting, Schlumberger provided deferred taxes related to, among other items, the estimated fair value adjustments for acquired inventory, intangible assets and assumed debt obligations. (4) Prior to the completion of the merger, Cameron and Schlumberger operated OneSubsea, a joint venture that manufactured and developed products, systems and services for the subsea oil and gas market, which was 40% owned by Schlumberger and 60% owned by Cameron. OneSubsea is now owned 100% by Schlumberger. As a result of obtaining control of this joint venture, Schlumberger was required to remeasure its previously held equity interest in the joint venture to its acquisition-date fair value. Schlumberger determined that the estimated fair value of its previously held equity interest approximated its carrying value. Accordingly, Schlumberger did not recognize any gain or loss on this transaction. (5) The goodwill recognized is primarily attributable to expected synergies that will result from combining the operations of Schlumberger and Cameron, as well as intangible assets which do not qualify for separate recognition. The amount of goodwill that is deductible for income tax purposes is not significant. Supplemental Pro Forma Financial Information Cameron’s results of operations have been included in Schlumberger’s financial statements for periods subsequent to the closing of the acquisition on April 1, 2016. Businesses acquired from Cameron contributed revenues of approximately $4 billion and pretax operating income of approximately $0.7 billion for the period from April 1, 2016 through December 31, 2016. The following supplemental pro forma results of operations assume that Cameron had been acquired on January 1, 2015. The supplemental pro forma financial information was prepared based on the historical financial information of Schlumberger and Cameron and has been adjusted to give effect to pro forma adjustments that are both directly attributable to the transaction and factually supportable. The pro forma amounts reflect certain adjustments to amortization expense, interest expense and income taxes resulting from purchase accounting. The pro forma results for the year ended December 31, 2016 reflect adjustments to exclude after-tax merger and integration costs of $285 million and after-tax charges relating to the amortization of the inventory fair value adjustment of $209 million. The supplemental pro forma financial information presented below is unaudited and does not include any anticipated cost savings or the expected realization of other synergies associated with this transaction. Accordingly, this supplemental pro forma financial information is presented for informational purposes only and is not necessarily indicative of what the actual results of operations of the combined company would have been had the acquisition occurred on January 1, 2015, nor is it indicative of future results of operations.
| (Stated in millions, except per share amounts) |
| 2016 |
Revenue | $ | 29,438 |
Net income (loss) attributable to Schlumberger | $ | (1,419 | )
Diluted earnings (loss) per share | $ | (1.02 | )
Other Schlumberger made other acquisitions and investments for cash payments, net of cash acquired, of $292 million during 2018, $847 million during 2017 and $407 million during 2016. None of these transactions were significant to Schlumberger’s consolidated financial statements, either individually or in the aggregate.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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