
General Electric Co. said Thursday it is exploring “potential partnerships’’ with oil-field services company Baker Hughes Inc., signaling that the Boston company may reshape its struggling oil and gas business.
“While nothing is concluded, none of these options include an outright purchase,’’ GE spokeswoman Deirdre Latour said in an e-mailed statement. She declined to comment beyond the statement.
The Wall Street Journal reported that the industrial giant is in talks to merge its oil and gas unit with Baker Hughes, citing people familiar with the matter. GE could possibly spin off the business into a separate publicly traded company, the newspaper said, cautioning that a deal might not be reached. Melanie Kania, a spokeswoman for Baker Hughes, declined to comment on GE’s statement, according to Bloomberg.
The discussions show that GE is looking at options for its energy business, which is still hurting after crude prices fell by more than 75 percent from a peak of $110 per barrel in September 2013 through this February.
The collapse led to a brutal shakeout in the energy business, highlighted by Halliburton Co.’s attempt to combine with Houston-based Baker Hughes. The companies, two of the largest in the oil services industry, called off a deal in May after the Justice Department went to court to block it, saying it was anticompetitive.
Oil has rallied 34 percent since bottoming out and trades at just under $50 a barrel.
“Our outlook for oil and gas has worsened,’’ GE chief executive Jeffrey Immelt said in a conference call last week. “But don’t be mistaken: We still think this is a core GE business.’’
The unit, which sells a range of products used in energy exploration and production, accounted for $16.5 billion in revenue in 2015, or about 14 percent of the company’s total.
Baker Hughes provides products and services used in exploration, drilling, and production of oil and gas. Revenue fell 36 percent to $15.7 billion last year. The company’s market value is $23 billion, compared with $258 billion at GE.