Baker Hughes has signed an agreement with Norway’s Akastor to create a joint venture company to provide full-service offshore drilling equipment.

The new joint venture company will combine Baker Hughes’ Subsea Drilling Systems (SDS) business and Akastor’s subsidiary, MHWirth, to provide a broad portfolio of products and services.

Baker Hughes’ SDS business, which is a division of its oilfield equipment segment, offers integrated drilling products and services to its customers worldwide.

On the other hand, HWirth is a provider of advanced drilling solutions and services.

Under the agreement, Akastor will contribute its shares in MHWirth to the new company for a 50% stake and $120m in consideration.

Baker Hughes will contribute the SDS business to the JV for a 50% interest and $200m in consideration.

Akastor CEO Karl Erik Kjelstad said: “I strongly believe that this company will give a solid basis for both organisations to meet the current challenges in today’s market and to continue as a leader in developing advanced and efficient drilling solutions that support the industry’s transition towards more sustainable operations.”

The new joint venture company’s operations will be managed from existing offices in Houston, Texas, and Kristiansand in Norway.

Baker Hughes oilfield equipment executive vice-president Neil Saunders said: “The oil and gas industry is rapidly evolving, and we are constantly looking at new and innovative ways of delivering value to our customers.

“This company is the perfect fit between our respective portfolios and further transforms our core operations for long-term success, bringing complementary solutions to market and offering our customers a full offshore drilling equipment package.”

Planned to be completed in the second half of this year, the transaction is subject to customary conditions, including regulatory approvals.

Last month, Baker Hughes and artificial intelligence (AI) software provider launched an AI-based application to optimise oil and gas production.

The application is designed to allow well operators to view real-time production data and more accurately predict future production.