(Updates with closing share price in fourth paragraph.)
Oct. 21 (Bloomberg) -- Dril-Quip Inc.’s “surprising” announcement of the immediate retirement of its chief executive officer increases the possibility that the oilfield-equipment maker will be viewed as a takeover target, analysts said.
J. Mike Walker, a co-founder of the company, stepped down from his role as chairman and CEO effective immediately, Houston-based Dril-Quip said in a statement yesterday.
“With the last of three original founding co-CEOs leaving, M&A discussion rightfully heats up,” Tudor, Pickering, Holt & Co., a Houston-based investment bank, said in a note to clients today, referring to the merger and acquisition potential.
Dril-Quip rose 6.5 percent to $63.77 at the close in New York. The shares have declined 18 percent this year.
Walker co-founded the company in 1981 and it began trading publicly in 1997, according to its website. Blake DeBerry, who was senior vice president of sales and engineering, will take over as CEO and John Lovoi, managing partner of JVL Advisors LLC and a board member since 2005, will take over as chairman, the company said.
The announcement was “a surprising development” at a company that “has often been considered (and reported to be) an acquisition target,” according to a note today from J. David Anderson, Samantha Hoh and William S. Thompson, analysts with JPMorgan Chase & Co.
Jerry Brooks, chief financial officer of Dril-Quip, didn’t respond to a voicemail message seeking comment.
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