January 7, 2014 / 3:15 PM / 5 years ago

Sandvik buys U.S. Varel for about $740 million

STOCKHOLM (Reuters) - Swedish engineering group Sandvik (SAND.ST) said on Tuesday it had agreed to buy U.S.-based Varel International Energy Services Inc. in a deal worth about $740 million.

Sandvik said in a statement that Varel, a supplier of drilling gear such as drill bits and products for well construction, had revenues of about $340 million last year and around 1,300 employees.

“The acquisition is expected to be slightly accretive to earnings per share already in the first year,” Sandvik said.

“The key customer segment is in the oil and gas sector, with some exposure to the mining and construction industries.”

The closing of the acquisition was subject to standard regulatory approvals and certain environmental due diligence, the company added.

Reporting by Niklas Pollard, editing by Mia Shanley

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