EURASIA DRILLING COMPANY: SLB Deal - An Attractive Exit Option at a Time of Uncertainty

On Tuesday (20 Jan), EDCL announced plans to sell 45.65% stake to Schlumberger (SLB), its long-term strategic partner. EDCL shareholders are offered $22.00 per share, a premium of over 80% to the closing price on 19 Jan. Whilst the deal price is significantly below our current target price for the stock, it nevertheless offers an attractive exit opportunity to minority shareholders considering the ongoing uncertainty over the oil price and the rouble (EDCL's main contract currency). Therefore, we would recommend that shareholders accept the terms of the deal.

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