Gearhart - The Fight

The Fight

For its part, by 1983 Gearhart was enjoying the best growth in the company's history. With operations now stretching not only across North America, but also the Middle East, Africa, East Asia, South America and the North Sea, Gearhart now commanded international respect. From 1977 to 1981, it had grown from annual rvenues of $55 million to $240 million and recording 28 consecutive years of growth. From 1976 to 1979, Gearhart-Owen was the fastest growing company on the New York Stock Exchange.

MWD had now become a process desired by competing companies. By 1983, as an investment, General Electric had bought 25% of Gearhart's stock with rumors of a total buyout of the company. Marvin Gearhart was excited about that possible move, however it was not to be. Instead GE informed him that its shares in the company had been sold to Smith International, a competitor to some of Gearhart's divisions. Smith now made a move to buy just enough stock to gain control of the company. Gearhart decided to fight that move, at first through unsuccessful court appeals and later by acquiring the large geophysical company, Geosource. Geosource's size rivaled Gearhart's and the merge indebted Gearhart to the point it was no longer attractive to Smith. Although Gearhart had record revenues of $560 million in 1985, the money-losing habit of Geosource prevented a recovery. When the bottom fell out of the market in 1986, Gearhart had record revenues of over $670 million, employed well over 10,000 people worldwide, and had become the world's third largest wireline logging company. After over 30 years of fulfilling his dream, Marvin Gearhart's company was up for sale.

Late in 1987, its Canadian partner Computalog had signed a letter of intent with Gearhart providing for the possible restructuring and whole acquisition of the company. By February of the following year it was ready and told the Gearhart management of the plan. On February 24, 1988 it was announced that Gearhart was entering into a buyout agreement with oilfield service giant Halliburton Company. Within Halliburton it was merged with Welex Jet Services to become Halliburton Logging Services completing the circle which began 33 years earlier. Also, Halliburton later also acquired the division of Smith International that was to have originally been combined with Gearhart's MWD division.