Halliburton Co. (NYSE:HAL) shares fell more than 6 percent Monday after the world’s second-largest provider of oilfield services said it will acquire rival Baker Hughes Inc. (NYSE:BHI) for $34.6 billion in cash and stock.

The deal, which would combine the No.2 and No.3 players in the oil field service industry, is valued at $78.62 per Baker Hughes share with Baker Hughes shareholders receiving $19 a share in cash and 1.12 shares of Halliburton stock. Baker Hughes operates in 80 countries and has a market capitalization of $26.6 billion compared with Halliburton’s market cap of $47.65 billion. Schlumberger, the No.1 oil-field-services company, has a market cap of nearly $122.66 billion.

Representatives from Halliburton and Baker Hughes did not immediately respond to requests for comment.

“We are pleased to announce this combination with Baker Hughes, which will create a bellwether global oilfield services company and offer compelling benefits for the stockholders, customers and other stakeholders of Baker Hughes and Halliburton,” Dave Lesar, Halliburton CEO, said in a statement.

Halliburton said it will buy all outstanding shares of Baker Hughes in a stock-and-cash transaction, and Baker Hughes stockholders will own approximately 36 percent of the combined company. The transaction is subject to regulatory approvals.

“This brings our stockholders a significant premium and the opportunity to own a meaningful share in a larger, more competitive global company,” said Martin Craighead, chairman and chief executive officer of Baker Hughes.

Following the announcement, and shortly before trading began Monday, shares of Baker Hughes soared over 16 percent to $69.75 . Meanwhile, Halliburton stock fell more than 6 percent to $51.57.