Subsea 7 has picked up a number of businesses from EMAS Chiyoda Subsea (ECS), the subsea joint venture led by Singapore’s Ezra Holdings before it filed for chapter 11 in February, with the acquisitions confirmed by the US Bankruptcy Court overnight.
Subsea 7 said it will be paying less than $100m in total, including its contribution to the debtor in possession credit facility, to acquire the businesses, the Ingleside spoolbase and sundry other assets.
The acquisition will add around $850m of order backlog for Subsea 7, with $750m of the backlog due in 2017 and 2018.
Subsea 7 also takes on around 850 ECS staff in Houston, Singapore and Saudi Arabia as part of the acquisition.
Jean Cahuzac, CEO of Subsea 7, 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.”
Subsea 7 has also signed charter agreements with ECS, taking the 2007-built pipelay vessel Lewek Champion on a multi-year bareboat charter for operations in the Middle East and 2014-built pipelay vessel Lewek Constellation on a short-term charter to complete work in other areas.
on a multi-year bareboat charter for operations in the Middle East and 2014-built pipelay vessel Lewek Constellation on a short-term charter to complete work in other areas.
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