Italy’s Saipem has agreed to sell its onshore drilling business to KCA Deutag for $550m and a 10% stake in the Aberdeen-based drilling and engineering contractor.
Saipem said the move is a further step toward a more focused and resilient business model based on the growing trends of Saipem’s reference markets and concentrating efforts in offshore drilling.
The cash proceeds from the transaction will improve Saipem’s liquidity, lowering its net debt and supporting the delivery of its 2022-25 business plan, the company added.
Saipem’s onshore drilling business operates outside Italy, with a focus in the Middle East and Americas, with a portfolio of 83 proprietary land rigs, which will add to KCA Deutag’s 110 drilling rigs operating in 20 countries.
Closing of the transaction is expected to take place by October 31, 2022, for the activities in the Middle East and by March 31, 2023, for the Americas.