(MENAFN- AFP) The world's second biggest oil services company, Halliburton, is threatening to overturn the board at Baker Hughes after merger talks between the two US companies stalled, the smaller company said.
Baker Hughes said Halliburton, which had presented an "unsolicited proposal" last month to buy all outstanding shares, had notified it of its intention to nominate candidates to replace the entire board at the April 2015 annual meeting.
The move opens the possibility of a hostile takeover bid by Halliburton.
"Baker Hughes considers the notice to be an attempt by Halliburton to pressure the Baker Hughes board into accepting a transaction with Halliburton on Halliburton's terms," said the statement from the world's third-biggest oil services company.
Baker Hughes said Halliburton refused to increase its initial offer, which it said the larger company claimed would "produce $2 billion in synergies after any required divestitures."
Baker Hughes, based in Houston, Texas, as is Halliburton, did not disclose further details of the offer.
"Baker Hughes is disappointed that Halliburton has chosen to seek to replace the entire Baker Hughes board rather than continue the private discussions between the parties," CEO Martin Craighead said in the statement.
The possible merger comes amid a drop in oil prices -- at their lowest levels since 2010 -- which could force oil companies to restrict their exploration efforts, something that would directly impact subcontractors like Baker Hughes and Halliburton.
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