NEW YORK (TheStreet) -- General Electric (GE) - Get Report announced on Monday morning that it is combining its oil and gas business with Baker Hughes (BHI), creating a new publicly traded energy business with $32 billion in revenue.
Bloomberg energy reporter David Wethe appeared on this afternoon's "Bloomberg Markets: Americas" and discussed why now is a good time for this deal.
This is the right time "in the sense that it's in the bottom of the cycle pretty much and particularly for this kind of a deal where neither side is really selling out," Wethe said. "So shareholders don't feel like they're missing out on the upside."
There is no premium cost or exposure of any cost in the transaction.
BloombergTV's Scarlett Fu asked Wethe if the deal should be viewed as a joint venture since it is not a straight takeover.
"Yeah, even though GE will maintain control over the company, more than 60% ownership, it really does in a lot of ways feel like sort of more of a joint venture kind of equal partnership," he responded.
Both companies will feel as though they are taking "equal advantage of the other," Wethe continued. The CEOs of both companies will have a piece of the leadership in the combined company. Baker Hughes brings a lot of heft from the oil services sector and GE brings some heft from the equipment making and sales network perception.
(GE is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of Cramer's holdings with a free trial.)