On Bauer Business Focus—A conversation on the recent Halliburton and Baker Hughes merger with Houston Public Media News 88.7 Business Reporter Andrew Schneider.
This week began with news of the largest energy merger, Halliburton’s acquiring of Baker Hughes.
Craig Pirrong, finance professor at the C. T. Bauer College of Business at the University of Houston stopped by Bauer Business focus to discuss the merger and the effects it may have on the region and the potential reasons behind the merger.
“The oil industry is likely looking forward to a contraction due to lower oil prices, and there’s going to be less drilling activity around the world as a result of lower oil prices,” Pirrong said. “It’s common under those circumstances to reduce costs and eliminate excess capacity.”
When the companies announced the merger, a main point from Halliburton’s CEO was the company’s plan to expand its workforce over the coming years.
“Employees, particularly in the central offices of both companies, are at risk to losing jobs,” Pirrong said. “Essentially, one way or the other, the way that this merger is going to make money is through the ‘synergies’ that are claimed and that results in the loss of jobs.”