Houston oilfield services giant Baker Hughes is offering buyout packages to its Norway employees to help cut costs as the international energy sector continues to languish.
The move comes while Baker Hughes prepares to combine with a unit of General Electric in a $32 billion merger that would create an expanded Baker Hughes. The deal is expected to close midyear. GE, based in Boston, would own 62.5 percent of the combined company.
However, Baker Hughes emphasized that offering severance packages to some European employees is unrelated to the merger.
“The offshore oil and gas industry, including Baker Hughes, continues to face difficult market conditions globally and in Norway,” Baker Hughes spokeswoman Melanie Kania said in a prepared statement. “To meet the challenges of today while positioning it for growth in the future, the company is adjusting its business to improve efficiencies and reduce its cost structure.
“Baker Hughes has implemented a range of actions to reduce costs, including a voluntary severance program in which employees can apply for an enhanced severance package,” she added. “The company believes this is the most proactive and fair mechanism to optimize its workforce in these market conditions.”
As recently as January, Baker Hughes still employed about 33,000 people, down from a headcount of more than 62,000 employees before the oil bust began in late 2014. However, some reductions are continuing.