UPDATE 2-Weatherford to buy TNK-BP's services unit
* Deal valued at $480 mln
* Weatherford shares rise 1.3 percent (Adds byline, analyst comment, background)
By Anna Driver
HOUSTON, May 29 (Reuters) - Weatherford International Ltd (WFT.N) said on Friday it would buy the oilfield services unit of No. 3 Russian oil producer TNK-BP for $480 million in stock.
Under the terms of the deal, which must be approved by Russia's Federal Anti-monopoly Service, Weatherford will exchange 24.3 million shares for the unit, which had revenue of $650 million in 2008.
"This investment in Russia's oil industry and its future growth strengthens Weatherford's position in one of the most important global oilfield service markets," Bernard Duroc- Danner, chief executive officer of Switzerland-based Weatherford, said in a statement.
TNK-BP's services business comprises six operating companies owning and operating more than 75 drilling rigs, 180 workover units, 150 cementation and pumping units and more than 10 operating bases.
"From a replacement value alone, we think they are getting a pretty good deal, even if you want to risk it for Russian risk," said Bill Herbert, an analyst with energy research firm Simmons & Co Intl, noting that Weatherford is also getting a preferential relationship with TNK-BP.
Oilfield services companies, including Weatherford's larger rival Schlumberger Ltd (SLB.N), have targeted Russia as a growth market for their services, but it can be a tricky place to operate for non-Russian companies.
TNK-BP is 50 percent-owned by BP Plc (BP.L) and 50 percent by a group controlled by four Russia-connected billionaires. BP this week gave ground in battle for leadership of the oil firm, ceding the position to Mikhail Fridman, one of its partners.
Weatherford shares were up 43 cents, or 2.14 percent, at $20.56 in afternoon trading on the New York Stock Exchange, in line with a 1.5 percent gain in the Philadelphia Stock Exchange index of oil field services companies .OSX. (Reporting by Anna Driver in Houston; editing by John Wallace)
