Baker Hughes Seals LNG Equipment Maker Chart Deal—Flowserve Left in the Dust

Another day, another energy sector shuffle—this time with LNG equipment maker Chart Industries throwing its lot in with Baker Hughes. The move comes hot on the heels of Chart abruptly ditching its prior engagement with Flowserve. Guess commitment isn’t a priority in the industrial romance department.

Why settle for one suitor when you can pivot to a bigger fish? Baker Hughes, the oilfield services heavyweight, just scored a strategic win by snapping up Chart’s LNG tech expertise. Meanwhile, Flowserve’s engineers are probably drowning their sorrows in lukewarm coffee.

Deal math: Zero dollars spent on sentimentality. The energy sector’s version of 'it’s not you, it’s me'—except it’s definitely you, Flowserve.

Key Takeaways

• Baker Hughes agreed to acquire Chart Industries for $13.6 billion, or roughly $210 per share of Chart stock.
• Chart shares popped following the deal, while Baker slid slightly.
• In conjunction with the Baker deal, Chart terminated a previous merger agreement with Flowserve.
• Baker said the deal makes the company better "able to meet the growing demand for lower-carbon, efficient energy and industrial solutions."

Oilfield services provider Baker Hughes (BKR) has reached a deal to acquire liquified natural gas equipment manufacturer Chart Industries (GTLS) in an all-cash deal worth $13.6 billion.

The deal comes out to $210 per share of Chart stock, which represents a 22% premium over Monday’s closing price. Shares surged 16% to nearly $199 in recent trading Tuesday. Baker shares slid 2%. 

Baker’s proposal beat an offer from liquid pump and valve Maker Flowserve (FLS), which had agreed to an all-stock merger with Chart in June. Chart called Baker's deal "superior" in a statement Tuesday, and Flowserve said it will receive a $266 million payout as a result of Chart terminating the deal. Its shares traded slightly higher. 

Chart designs and manufacturers equipment for gas and liquid molecule handling. Baker said the acquisition positions the combined company as able to “meet the growing demand for lower-carbon, efficient energy and industrial solutions."