Schlumberger Agrees to Sell NPTest Unit

Schlumberger, an oilfield services company that is shedding assets to cut debt, agreed on Tuesday to sell its San Jose-based NPTest semiconductor-testing unit to a group led by Francisco Partners and Shah Management for $220 million in cash.

The deal came one day after plans to take NPTest public in an initial public stock offering were dropped due to “conditions in the securities markets.”

The IPO, which had been delayed for more than a year, was expected to raise as much as $575 million, according to a regulatory filing.

Schlumberger, which purchased at least eight technology businesses from 1999 through 2001 to diversify, began a push last year to sell assets outside the energy industry to cut debt and bolster its credit ratings.

The NPTest sale will reduce Schlumberger’s second-quarter profit by $12 million, the firm said. The buyers may pay an additional, undisclosed sum if they sell the unit or raise money through an IPO of NPTest.

The $220 million “would seem to be a pretty low price,” said Michael Urban, an analyst with Deutsche Bank Securities Inc. “But this is cash in hand today that they can apply to debt reduction.”

Shares of Schlumberger rose 25 cents to $47.50 in New York Stock Exchange trading.

NPTest, a 900-employee company that designs and makes semiconductor-testing equipment, had 2002 revenue of $230 million, down 47% from a year earlier.

The sale is scheduled to close in July.

Francisco Partners, based in Menlo Park, Calif., is the world’s largest technology-focused buyout firm.