BUZZ-Bears on alert as OFS deal chatter gets louder

** More shorts could be squeezed out as M&A buzz around OFScos hots up

** Some short covering has already been at work sinceannouncement of Halliburton /Baker Hughes deal &Technip's offer to buy CGG, analysts say

** Amec Foster Wheeler & Petrofac 3rd & 4thmost borrowed stocks on FTSE 100 respectively, Markit data shows

** Consolidation may help cos cope with collapsing oil pricewhich has hit exploration & production

** Nomura bearish on sector as global capex cycle set formulti-year decline; but key risk to this view is OFS cos becomeimmune to EPS downgrades as M&A expectations rise

** Advises investors looking to gain exposure to M&A to buya basket containing: Amec, Lamprell & Maire Tecnimont

** Broker considers it less likely that seismic marine &deepwater drilling sectors consolidate unless valuations aremeaningfully lower than current levels (RM: tricia.wright1.thomsonreuters.com@reuters.net)