Saipem and Subsea7 announce merger to form global energy services leader

In a landmark move set to reshape the energy services sector, Italian firm Saipem and Norwegian company Subsea7 have agreed to merge, creating a new entity named Saipem7. This merger aims to establish a global leader in energy services, boasting a combined backlog of €43 billion, annual revenues of approximately €20 billion, and an EBITDA exceeding €2 billion. 

The merger is designed to capitalise on the complementary strengths of both companies. Saipem and Subsea7 have distinct yet synergistic geographical footprints, client bases, and technological capabilities. By uniting, they plan to offer a more comprehensive range of services to clients across the oil, gas, carbon capture, and renewable energy sectors. The combined workforce will comprise over 45,000 employees, including more than 9,000 engineers and project managers. 

Claudio Descalzi, CEO of Eni, remarked, "With this transaction, we are creating a global leader of significant industrial and technological value. Over the past few years, Saipem has continuously improved its operational and financial performance, achieving a position of excellence that enables it to play a leading role in this major transformation."

Financial and operational synergies

The merger is expected to yield significant financial benefits, with anticipated annual synergies of approximately €300 million by the third year post-completion. These savings are projected to stem from optimised fleet utilisation, streamlined procurement processes, enhanced sales and marketing efforts, and improved operational efficiencies. The integration will also result in a diversified fleet of over 60 construction vessels, enabling Saipem7 to undertake a wide array of projects, from shallow water to ultra-deepwater operations. 

Under the terms of the agreement, shareholders of both Saipem and Subsea7 will each hold a 50% stake in the newly formed company. Subsea7 shareholders are set to receive 6.688 Saipem shares for each Subsea7 share they own. Additionally, Subsea7 plans to distribute an extraordinary dividend of €450 million immediately prior to the merger's completion. The combined company will maintain listings on both the Milan and Oslo stock exchanges. 

Major stakeholders, including Siem Industries (the principal shareholder of Subsea7), as well as Eni and CDP Equity (the controlling shareholders of Saipem), have expressed strong support for the merger. These entities have signed a memorandum of understanding outlining their commitment to the transaction and the governance principles for Saipem7. Collectively, they will represent approximately 29% of the share capital, with Eni holding 10.6%, CDP Equity 6.4%, and Siem Industries 11.8%. 

The merger is subject to customary conditions, including approvals from shareholders of both companies and relevant regulatory authorities. The parties aim to finalise the merger agreement by mid-2025, with completion anticipated in the second half of 2026.

Dario Scannapieco, CEO of Cassa Depositi e Prestiti, added, "Together with Eni, we have worked in harmony and successfully completed a major industrial transaction. The combination of Saipem and Subsea7 activities represents a significant strengthening of high-tech companies that are already well-established in their respective markets."

This merger signifies a strategic consolidation in the energy services industry, positioning Saipem7 as a formidable entity poised to meet the evolving demands of the global energy market.