Oilfield service provider Schlumberger Limited (NYSE: SLB – $69.09), and Cameron International Corp., a major provider of flow equipment products, systems and services to the worldwide oil and gas industry, announced a definitive merger agreement in which the companies will combine in a stock and cash transaction. Under the terms of the agreement, Cameron shareholders will receive 0.716 shares of Schlumberger common stock and a cash payment of $14.44 in exchange for each Cameron share. Schlumberger expects to realize pretax synergies of about $300 million and $600 million in the first and second year, respectively. Initially, the synergies are primarily related to reducing operating costs, streamlining supply chains and improving manufacturing processes, with a growing component of revenue synergies in the second year and beyond. Schlumberger also expects the combination to be accretive to earnings per share by the end of the first year after closing. The transaction combines two complementary technology portfolios into a “pore-to-pipeline” products and services offering to the global oil and gas industry. On a pro forma basis, the combined company had 2014 revenues of $59 billion. With the low price of oil, Schlumberger believes the time is right for such a deal looking ahead to when energy prices move to more normal levels. The good-quality stock, although beaten down with the price of oil, offers sizable long-term capital gains potential for patient investors.