Morningstar Names Merrill A. (Pete) Miller Jr. of National Oilwell Varco as its 2012 CEO of the Year

 Morningstar Names Merrill A. (Pete) Miller Jr. of National Oilwell Varco as
                           its 2012 CEO of the Year

PR Newswire

CHICAGO, Jan. 3, 2013

CHICAGO, Jan. 3, 2013 /PRNewswire/ --Morningstar, Inc. (NASDAQ: MORN), a
leading provider of independent investment research, today named Merrill A.
(Pete) Miller Jr., CEO of Houston-based National Oilwell Varco, as its 2012
CEO of the Year. Morningstar annually recognizes a chief executive who
exhibits exemplary corporate stewardship, demonstrates independent thinking,
creates lasting value for shareholders, and has put his or her stamp on an
industry.

The two other nominees for Morningstar's 2012 CEO of the Year award were
George Paz of Express Scripts and J. Michael Pearson of Valeant
Pharmaceuticals International.

"This year's nominees have been instrumental in transforming their companies
from small players or those with few competitive advantages to leaders in
their industries," said Paul Larson, chief equities strategist and editor of
Morningstar StockInvestor. "We selected Miller, who has served as CEO of
National Oilwell Varco since 2001, as our winner this year for the rare
combination of excellence he's demonstrated across all three facets of a chief
executive's job—strategic insights, capital allocation, and execution.

"Miller has successfully mitigated the inherent risks of doing business in the
oil and gas equipment and services industry. For instance, he executed an
acquisition-heavy strategy, which can carry the threat of operational miscues,
without a hitch. Despite the pace of acquisitions, Miller has prioritized
shareholder-friendly actions by paying a special dividend in 2009, cutting his
own salary in light of the difficult economic environment in 2008, and openly
sharing his thoughts with analysts about where he thinks the market is going
and how National Oilwell Varco is positioned to compete."

In the last 18 months, continuing a long-running streak of deals, National
Oilwell Varco under Miller has completed or has pending nearly $6 billion in
acquisitions. In another move that reflects substantial value creation for
shareholders, the company also raised $3 billion in senior notes in the midst
of an extremely favorable corporate credit environment.

With Miller at the helm, National Oilwell Varco has reshaped the oilfield
equipment industry and is positioned to maintain its influence:

  oAfter an impressive string of deals mostly led by Miller over the last 15
    years, National Oilwell Varco has become a critical player in the
    industry, with such leading technology and services that many drillers are
    electing to standardize around its equipment.
  oMiller successfully predicted several major industry shifts—the aging of
    global rig fleets, the onset of shorter lifecycles for equipment necessary
    to exploit North American oil and gas reservoirs, and the need for
    floating production storage and offshore (FPSO) units used for offshore
    markets—and invested billions of dollars in capital to situate National
    Oilwell Varco favorably ahead of them. 
  oThe company's footing uniquely positions it to become one of the leading
    suppliers for FPSO and related subsea efforts, a development likely to
    unfold over the next decade, replicating its earlier success with offshore
    drilling in terms of market penetration and approach to equipment
    standardization. 

"National Oilwell Varco is one of the very few companies in Morningstar's
coverage universe with a Wide 'Economic Moat' Rating, a Positive Economic Moat
Trend, and an Exemplary Stewardship Rating," Larson added. "We don't award
moat ratings based on operational effectiveness or skilled management, but we
do acknowledge that they can strengthen a firm's moat. Miller's actions, along
with those of his management team, have indeed steeled National Oilwell
Varco's competitive position by changing the way offshore rigs are built to
the company's benefit,solidifying itslow-cost position in the industry as
drillers standardized around its products to take advantage of improved rig
economics. Meanwhile, National Oilwell Varco reaped the benefits of powerful
switching costs through the integration of its equipment into a single
operating system."

Morningstar's Economic Moat™ rating is a proprietary measure of a company's
sustainable competitive advantages, and Morningstar assigns each company a
rating of Wide, Narrow, or None. A company can obtain an economic moat through
five primary sources: Efficient Scale (a limited market where there is little
incentive for new entrants), Network Effect (a situation where incremental
customers add value for existing customers), Cost Advantage (allowing a
company a greater profit margin and/or the ability to steal market share),
Intangible Assets (e.g. patents or strong brands), and Switching Costs (making
it costly in time and/or money for customers to switch providers). Morningstar
also evaluates a company's "moat trend," which indicates whether the economic
moat of its underlying businesses is strengthening or weakening.

Morningstar introduced its CEO of the Year award in January 2000. Winners are
chosen by senior members of Morningstar's equity analyst team based on their
in-depth independent research.

For Morningstar's commentary about Miller, go to:
http://www.morningstar.com/goto/ceo2012. 

For the complete list of past winners, go to:
http://corporate.morningstar.com/CEOhalloffame.

About Morningstar, Inc.

Morningstar, Inc. is a leading provider of independent investment research in
North America, Europe, Australia, and Asia. The company offers an extensive
line of products and services for individuals, financial advisors, and
institutions. Morningstar provides data on more than 385,000 investment
offerings, including stocks, mutual funds, and similar vehicles, along with
real-time global market data on more than 8 million equities, indexes,
futures, options, commodities, and precious metals, in addition to foreign
exchange and Treasury markets. Morningstar also offers investment management
services through its registered investment advisor subsidiaries and has more
than $195 billion in assets under advisement and management as of Sept. 30,
2012. The company has operations in 27 countries.

©2013 Morningstar, Inc. All Rights Reserved.

MORN-C

Media Contact:

Carling Spelhaug, 312-696-6150 or carling.spelhaug@morningstar.com





SOURCE Morningstar, Inc.

Website: http://www.morningstar.com
 
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