FILED BY NATIONAL-OILWELL, INC. PURSUANT TO
                       RULE 425 UNDER THE SECURITIES ACT OF 1933, AS AMENDED AND
                                  DEEMED FILED PURSUANT TO RULE 14A-12 UNDER THE
                                     SECURITIES EXCHANGE ACT OF 1934, AS AMENDED

                                      SUBJECT COMPANY: VARCO INTERNATIONAL, INC.
                                                   COMMISSION FILE NO. 001-08158


         This filing relates to the proposed merger of equals transaction (the
"Transaction") by between National-Oilwell, Inc. ("National-Oilwell") and Varco
International, Inc ("Varco") pursuant to the terms of an Agreement and Plan of
Merger, dated as of August 11, 2004 (the "Merger Agreement"), by and between
National-Oilwell and Varco. The Merger Agreement is on file with the Securities
and Exchange Commission as an exhibit to the Current Report on Form 8-K filed by
National-Oilwell on August 12, 2004, and is incorporated by reference into this
filing.

         ON AUGUST 12, 2004, NATIONAL-OILWELL SENT A MEMORANDUM TO ALL OF ITS
EMPLOYEES REGARDING THE TRANSACTION. THE TEXT OF THE MEMORANDUM IS AS FOLLOWS:


[NATIONAL OILWELL LOGO]


                                                       NATIONAL OILWELL
                                                       10000 Richmond
                                                       Avenue
                                                       Houston, TX
                                                       77042
                                                       P.O. Box 4888
                                                       Houston, TX
                                                       77210-4888
                                                       PHONE
                                                       713-346-7559
                                                       FAX 713-346-7975
                                                       pete.miller@natoil.com

Date:             August 12, 2004

From:             Pete Miller

Re:               Merger Announcement

================================================================================

As announced in the attached press release that was issued this morning,
National Oilwell and Varco have entered into a merger agreement. The combined
company will be named National Oilwell Varco, Inc. and will bring together some
of the most respected product and service lines in the industry.

We are very excited about this combination and the opportunities it presents.
National Oilwell Varco will be better positioned to compete effectively in the
global marketplace and to respond to our customers' needs with an unparalleled
level of quality in capital equipment, expendable products and services. Today,
National Oilwell and Varco share the common values of customer service and
quality product innovation. Over the next few months, both companies will
develop a plan to support these values and maximize the strengths of the
combination.

It is the strength, dedication and performance of our employees that make this
exciting growth opportunity possible. We anticipate that the merger will occur
in four to six months. Until that time, we will continue with business as usual.
Thank you for your continued efforts.






FORWARD-LOOKING STATEMENTS

Statements made in this press release that are forward-looking in nature are
intended to be "forward-looking statements" within the meaning of Section 21E of
the Securities Exchange Act of 1934 and may involve risks and uncertainties.
These statements include, without limitation, statements regarding the
consummation of the transaction, its effects on future earnings or other
operating results, the expected closing date of the transaction, any other
effect or benefit of the transaction, and any other statements that are not
historical facts. These risks and uncertainties include the ability of National
Oilwell and Varco to achieve their forecasted operating results and the cost
savings and operating benefits currently expected from the proposed transaction
and the timing and receipt of approvals for the merger. Other risks and
uncertainties, which are more fully described in documents filed by National
Oilwell and by Varco with the Securities and Exchange Commission, including
Annual Reports on Form 10-K, could cause actual results to differ from those
contained in the forward-looking statements.

ADDITIONAL INFORMATION

In connection with the proposed merger, National-Oilwell, Inc. and Varco
International Inc. will file a joint proxy statement/prospectus with the
Securities and Exchange Commission. National-Oilwell, Inc. and Varco
International Inc. and their respective directors and officers may be deemed to
be participants in the solicitation of proxies from their respective
stockholders. Information about these persons can be found in National Oilwell's
and Varco's respective Annual Reports on Form 10-K filed with the SEC and
additional information about such persons may be obtained from the proxy
statement/prospectus when it becomes available. INVESTORS AND SECURITY HOLDERS
ARE URGED TO CAREFULLY READ THE JOINT PROXY STATEMENT/PROSPECTUS REGARDING THE
PROPOSED TRANSACTION WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION. Investors and security holders may obtain a free copy of
the joint proxy statement/prospectus when it is available and other documents
containing information about National-Oilwell, Inc. and Varco International
Inc., without charge, at the SEC's web site at WWW.SEC.GOV, National Oilwell's
web site at WWW.NATOIL.COM, and Varco's web site at WWW.VARCO.COM. Copies of the
joint proxy statement/prospectus and the SEC filings that will be incorporated
by reference therein may also be obtained for free by directing a request to
either Investor Relations, National-Oilwell, Inc., 713-346-7500 or to Investor
Relations, Varco International, Inc., 281-953-2200.

                                    # # # # #