Subsea 7 moves to acquire McDermott for $2bn, wants CB&I deal scrapped

Subsea 7 moves to acquire McDermott for $2bn, wants CB&I deal scrapped

Kristian Siem-led Subsea 7 has proposed a deal to the board of US offshore firm McDermott International to acquire the entire issued share capital of the company at $7 a share, valuing the company at near $2bn.

The offer from Subsea 7 is priced at a 15.7% premium to McDermott’s last closing share price, and the deal will be funded either entirely in cash or including up to 50% in Subsea 7 shares.

While the initial offer has been rejected, Subsea 7 told McDermott that it is even willing to increase its offer “upon further assessment of McDermott’s business through discussions with McDermott management”.

The deal is subject to the termination of McDermott’s $6bn merger with CB&I which was announced late last year.

Jean Cahuzac, CEO of Subsea 7, commented: “Given the attributes of the proposed transaction and our stated ability to further enhance our proposed terms, we encourage the McDermott Board of Directors to reconsider this compelling opportunity to combine two complementary businesses. Our proposal provides equity upside in a company with a robust financial position, as well as a meaningful premium. We see significant merit in such a transaction for all shareholders, and with our financial and legal advisors continue to be open to discussions.”

Grant Rowles

Grant spent nine years at Informa Group based in London, Sydney, Hong Kong and Singapore. He gained strong management experience in publishing, conferences and awards schemes in the shipping and legal areas, working on a number of titles including Lloyd's List. In 2009 Grant joined Seatrade responsible for the commercial development of Seatrade’s Asia products. In 2012, with Sam Chambers, he co-founded Asia Shipping Media.

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