Cameron International Corp., Houston, (NYSE: CAM) has closed its acquisition of Natco Group Inc., Houston, (NYSE: NTG) in a deal valued at approximately $780 million in stock.

Natco shareholders received 1.185 shares of Cameron common stock for each share of Natco common stock held and will receive cash reflecting the value of any fractional shares. Cameron has issued approximately 23.7 million shares in conjunction with the deal.

Natco provides process equipment, systems and services, including proprietary equipment and technologies, to the worldwide oil and gas industry. The company has approximately 2,400 employees and generated revenues of more than $650 million during 2008.

The combination of these businesses immediately enhances both companies’ presence in the market for larger process systems, especially in Southeast Asia, West Africa, the Middle East and Brazil. The merger also broadens Cameron’s product offerings with a wider range of proprietary technologies, particularly in deepwater production processing and downstream markets; provides cross-selling opportunities for certain of Cameron's and Natco’s product lines; and adds manufacturing capability to Cameron in processing and separation products, a capability that Cameron previously did not have.

As a result of the acquisition, Natco’s shareholders now own approximately 10% of Cameron’s outstanding shares.

Cameron president and chief executive Jack B. Moore says, “We are pleased to add Natco’stalented people and complementary businesses to the Cameron organization, and we look forward to moving ahead with the integration process. As previously noted, we expect the acquisition to favorably impact our profitability in 2010, after adjusting for any integration costs."

Simmons & Co. International was financial advisor to Cameron. Barclays Capital was financial advisor to Natco.

After the deal was announced in early June, analysts at Tudor, Pickering, Holt & Co. Securities Inc. said the companies fit together and that Cameron will need to drive revenue benefits.

The Tudor analysts reported at the time, “We expect the two most significant investor concerns about the transaction to be valuation—paying higher multiple for Natco than Cameron trades at and the all stock composition of the transaction (this will drive investor pushback as to why Cameron has $1.4 billion in cash on hand if sizable transactions such as this are stock only). The valuation can be justified to the extent Cameron drives revenue growth beyond what Natco could capture standalone but this will take patience to bear out.”