The world’s largest service companies have been throwing out big numbers in recent days, most of them in the not good category.

Halliburton Co. (NYSE: HAL) said April 21 that as part of its planned $35 billion merger with Baker Hughes Inc. (NYSE: BHI), it will divest drilling segments that generate $3.5 billion in revenue and contribute 13.8% to adjusted operating margins.

Baker Hughes and Schlumberger Ltd. (NYSE: SLB), had different numbers to share. The companies have announced nearly 15,000 additional job cuts.

For Halliburton, the company will be giving up what analysts consider parts of a world-class oilfield service business. Targets for divestiture include Halliburton’s logging-while-drilling (LWD), measurement-while-drilling (MWD), drillbits and directional drilling (DD) businesses. The businesses fall under Halliburton’s drilling and evaluation division.

“These businesses generated approximately $740 million in EBITDA in 2014 and could generate $440 million in EBITDA in 2016,” said Ken Sill, senior analyst, Global Hunter Securities.

Sill said the businesses should garner about $3 billion in sale proceeds at a sales price of about 6.5x of 2016 estimated EBITDA.

“This would allow HAL to buy in approximately 60 million shares at $50/share or 7% of outstanding shares, which when combined with $2 billion in expected annual cost synergies makes the merger look quite attractive,” he said.

Sales proceeds could also be substantially higher since Halliburton will offer a rare opportunity to buy its world-class oilfield services franchises.

Tudor, Pickering, Holt & Co. said in a report that Halliburton’s bits, direction drilling and its logging-while-drilling units will receive a great deal of interest.

“Oilfield and industrial manufacturers are the logical bits buyers and this will not go cheap as the oligopoly/high margin business isn’t something on the market very often,” Tudor said.

The company’s DD/LWD business is sizable and one of three main players offshore.

“The scarcity value of such a premium business should keep the value strong,” Tudor said. “Private equity would seem to be a player for this slice of the HAL pie.”

Halliburton may have actually gained U.S. market share in the first quarter of 2015, particularly within pressure pumping, said J. Marshall Adkins, analyst, Raymond James.

The company said its stage counts had only fallen by about 6% quarter over quarter despite rig counts dropping 24% during the same time.

“Even with higher stage counts per well, we believe this means Halliburton gained considerable market share,” Adkins said.

Adkins’ reason: Halliburton’s customers are some of the largest, most stable E&Ps in the U.S. and companies want low costs, quality and reliability in a downturn.

Cutbacks

One potential bump in the road for Halliburton is that cost cutting measures have been abnormally held back during the downturn. The company’s hands are tied to some extent as it needs to maintain an infrastructure able to handle the higher activity and volumes that should come with the Baker Hughes merger.

Baker Hughes and Schlumberger both said they have reluctantly made additional cuts, particularly with staff.

During the first quarter of 2015, Baker Hughes reduced costs in response to the faltering market by closing or consolidating about 140 facilities worldwide. The company also idled or impaired excess assets and inventory and announced it would lay off 7,000 people.

Martin Craighead, Baker Hughes chairman and CEO, said April 21 that the company was forced to make additional cuts.

“We made the decision to increase our headcount reductions to a total of approximately 10,500 positions, or 17% of our workforce, which is 3,500 positions higher than what we previously announced,” he said. “Combined, these actions are projected to reduce cost by more than $700 million on an annualized basis.”

And on April 16, Schlumberger said staff reductions would total 20,000 since the beginning of the year.

“In spite of the detailed preparations we made in the fourth quarter of 2014, the abruptness of the fall in activity, particularly in North America, required us to take additional actions during the quarter,” said Paal Kibsgaard, Schlumberger chairman and CEO. “These included the difficult decision to make a further reduction in our workforce of 11,000 employees, leading to a total reduction of about 15% compared to the peak of the third quarter of 2014.”

In January, the company said it would lay off 9,000.

The company had as many as 126,000 employees worldwide. Schlumberger’s website currently reports a workforce of 115,000.

In Houston April 20, Ryan Lance, chairman and CEO of ConocoPhillips Co. (NYSE: COP), said the oil and gas industry has lost more than 100,000 jobs since the downturn.

Contact the author, Darren Barbee, at dbarbee@hartenergy.com.