Vetco on the block

General Electric is in talks to acquire certain parts of oilfield services company Vetco International from 3i, Candover and JP Morgan Partners, according to reports. The deal could be valued at more than US$1bn.

Under the potential deal, GE would acquire Vetco’s sub-sea processing unit and a sale could be agreed within the next few weeks. GE was a suitor for the Vetco assets two years ago, when the deal was eventually agreed instead with the private equity firms. The consortia paid US$925m for Vetco in January 2004, although some reports have said the assets could sell for between US$1bn and US$2bn this time round.

GE is interested in Vetco because the company wants to expand its oil and gas operations. GE’s goal is to raise its share of the annual US$238bn petroleum development market to US$55bn by 2008 from US$12bn currently. John Rice, president of GE Energy, specified subsea technology as a potential growth area in a previous presentation.