TWO REGULAR participants in Australia’s offshore energy sector have announced an in-principal agreement to merge.
Italy’s Saipem and Norway’s Subsea 7, with the backing of principal shareholders Eni and CDP Capital, and Siem Industries respectively, will join forces to form Saipem7 in a merger expected to be finalised mid-2025 and to complete in the second half of 2026.
Saipem7, to be headquartered in Milan, will have a combined backlog of €43 billion, revenue of approximately €20 billion and EBITDA in excess of €2 billion.
The merger will create a global organisation of over 45,000 people, including more than 9,000 engineers and project managers and will benefit from highly complementary geographical footprints, competencies and capabilities, vessel fleets and technologies, the companies say.
Annual synergies of approximately €300 million are expected to be achieved in the third year after completion, with one-off costs to achieve such synergies of approximately €270 million. The combined company will be listed on both the Milan and Oslo stock exchange.
The companies say Saipem7 will have an expanded and diversified fleet of more than 60 construction vessels enhancing its ability to undertake a wide range of projects, from shallow water to ultra-deepwater operations, utilising a full portfolio of heavy lift, high-end J-lay, S-lay and reel-lay rigid pipeline solutions, flexible pipe and umbilical lay services and market-leading wind turbine, foundation and cable lay installation capabilities.
The combined company will be structured in four businesses: Offshore Engineering & Construction, Onshore Engineering & Construction, Sustainable Infrastructures, and Offshore Drilling.
The Offshore Engineering & Construction business will be incorporated in an operationally autonomous company, named Subsea7 and branded as “Subsea7 – a Saipem7 Company”, and it is currently envisaged that it will be led by Mr John Evans. It will comprise all of Subsea7’s business and the Asset Based Services business of Saipem, representing approximately 83% of the combined group’s EBITDA of the last 12 months as of 30 September 2024. The company will be headquartered in London.
Saipem and Subsea 7 each have an Australian subsidiary, with both headquartered in Perth. The companies are currently active on the Scarborough and Barossa projects on the NW Shelf and the Timor Sea, and the latter in Bass Strait’s Minerva Field.
