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TechnipFMC buys Plexus’ wellhead business

TechnipFMC is to separate into two companies

Aug 27, 2019
3 min read
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TechnipFMC is to separate into two companies: RemainCo, focusing on technology, and SpinCo, an engineering and construction (E&C) player.

Thje move is aimed at enabling both companies to capitalise on distinctive markets and growth opportunities and is scheduled to be completed in the first half of 2020.

The transaction is expected to be structured as a spin-off of TechnipFMC’s Onshore/Offshore sector to be headquartered in Paris, France.

The 2017 merger of Technip S.A. and FMC Technologies, Inc. established TechnipFMC as a fully-integrated subsea provider.

The performance of the compsany ince the merger has made the proposed spin-off possible and, when completed, will enable the two companies to expand market opportunities and customer bases, while also focusing management, resources and capital.

Doug Pferdehirt, Chairman and CEO of TechnipFMC, said: “Since the creation of TechnipFMC, we have pioneered the integrated business model for subsea and transformed our clients’ project economics.

“To further enhance value creation, our Board of Directors and management team have continuously evaluated strategic options and, after a comprehensive review, determined that it is in the best interest of TechnipFMC and all of our stakeholders to create two diversified pure-play leaders.

“We are confident that the separation would allow both businesses to thrive independently within their sectors, enabling each to unlock significant additional value.”

With approximately 15,000 employees, SpinCo would be one of the largest E&C specialists and is aimed at the global energy transition looking towards LNG, as well as future growth opportunities in biofuels, green chemistry and other energy alternatives.

Rystad Energy’s head of oilfield service research Audun Martinsen said: “This move shows that TechnipFMC is a forward-thinking company with the ability to shape the business environment it operates in. The successful integration of FMC Technologies into the Technip organization in 2017 was impressive in its own right, creating a leading subsea entity on the global stage. Then to turn around two years later and manifest the value creation by splitting the company in two, is truly remarkable.”

The company will comprise the Onshore/Offshore segment, including Genesis – a leader in front end engineering and design, as well as Loading Systems, a leader in cryogenic material transfer products, and Cybernetix, a technology leader in process automation.

Catherine MacGregor, who currently serves as TechnipFMC’s President, New Ventures, will become CEO of SpinCo. Bruno Vibert will serve as CFO and Marco Villa will serve as COO. SpinCo will be incorporated in the Netherlands with its headquarters in Paris and listed on the Euronext Paris exchange.

RemainCo, with a workforce of 22,000, will be a fully-integrated technology and services provider, continuing to drive energy development. The company’s role will be to support clients in the delivery of unique, integrated production solutions..

Pferdehirt and Maryann Mannen, Executive Vice President and CFO TechnipFMC, will continue to serve in their roles following the separation.

The successful completion of the planned spin-off is subject to general market conditions, regulatory approvals and consultation of employee representatives, where applicable, and final board approval.

 

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