Halliburton makes break from KBR operation

Oil services giant Halliburton has split from its engineering and construction arm, KBR.

Oil services giant Halliburton has split from its engineering and construction arm, KBR.

KBR, the largest US contractor in Iraq, had been part of Halliburton for 44 years.

Halliburton first announced plans to separate from KBR, whose losses had dragged down overall profitability, in January 2005.

The contractor has also been plagued by investigations into its activities in Iran and Nigeria, while auditors, the Congressional Democrats and the Justice Department have scrutinised Halliburton over the quality and pricing of KBR's work for the US army in Iraq.

Under an exchange offer that expired on 2 April 2007, Halliburton swapped 135.6 million KBR shares, equal to an 81% stake, for 85.3 million of its own shares. All of the government services and engineering and construction businesses will remain with KBR.

"This is a major event for Halliburton, especially its dedicated employees, loyal customers and the shareholders," said Dave Lesar, chairman, president and CEO, Halliburton.

"As a pure oilfield services company, Halliburton now can focus on the global growth opportunities in its core energy services business."

Both companies are based in Houston. Halliburton sparked criticism from some US politicians when it announced plans last month to open a headquarters in Dubai in order to be better positioned to win contracts in the Middle East.

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