Subsea 7 is to acquire the business of EMAS Chiyoda Subsea (ECS), including 850 staff.
The acquisition, under a US bankruptcy code Chapter 11, was confirmed by the US Courts for the Southern District of Texas, effective on June 29.
Chief executive Jean Cahuzac said: “In a challenging business environment our differentiated offering and strong capital discipline has enabled us to pursue this opportunity.
“This targeted investment enables Subsea 7 to accelerate its strategy to provide a market leading service in the Middle East.
“The addition of people, local presence and client relationships of ECS to our market leading SURF and Conventional capability expands our global presence. As a result of this transaction we have significantly increased our presence in the Middle East, assuming a long-term agreement (LTA) and three current projects in Saudi Arabia, in consortium with L&T Hydrocarbon Engineering (L&T).”
Subsea 7 will pay less than $100 million in aggregate, including it’s contribution to the Debtor in Possession credit facility, to acquire certain ECS businesses, the Ingleside spoolbase and sundry other assets.
The acquired business of ECS includes approximately 850 people based in Houston, Singapore and Saudi Arabia.
Subsea 7 has secured a multi-year bareboat charter for the pipelay vessel Lewek Champion for activities in the Middle East, and a short-term charter for the pipelay vessel Lewek Constellation to complete work in hand in other geographies.
And as a result of the transaction, Subsea 7 has acquired approximately USD 850 million of order backlog, including five projects, each with backlog exceeding USD 50 million.
– Hasbah, in consortium with L&T, offshore Saudi Arabia
– Four Decks, in consortium with L&T, offshore Saudi Arabia
– 17 Cranes, in consortium with L&T, offshore Saudi Arabia
– OCTP, offshore Ghana
– TVEX, US Gulf of Mexico