Published by Global Banking & Finance Review®
Posted on February 24, 2025
3 min readLast updated: February 27, 2026
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Saipem and Subsea 7 merge to form Saipem7, aiming to lead in offshore energy services with a €43 billion order backlog.
By Francesca Landini and Nerijus Adomaitis
MILAN/OSLO (Reuters) - Italy's Saipem has agreed to merge with Norwegian rival Subsea 7 in an all-share deal to create a leading global player in offshore energy services.
The combined group, to be renamed Saipem7, will have an order backlog of 43 billion euros ($45 billion), revenue of about 20 billion, and core earnings of more than 2 billion, the two companies announced late on Sunday.
Saipem's shares opened up more than 5% on Monday before reversing to fall more than 4% while Subsea 7 was up 3.2% as of 1324 GMT.
Analysts during a call with the two groups' top teams cited concerns about antitrust risks, a long schedule for completing the merger, and the payment of a special dividend to Subsea 7 investors.
Saipem and Subsea 7 executives said the planned merger would combine complementary businesses across oil service segments and geographies.
"It will allow our clients to have one global oil service provider that could offer everything from ultra-shallow water to ultra-deep water," Subsea 7 CEO John Evans said on a call with analysts on Monday.
Saipem's clients include several national energy companies including Saudi Aramco, QatarEnergy, and Abu Dhabi's ADNOC. Subsea 7's customer base is more focussed on international oil firms such as BP and Equinor.
Analysts at Bernstein said the combined company would be "an unmatched world leader" in providing engineering and installations of complex subsea oil and gas systems, and in providing services for the offshore wind industry.
Saipem CEO Alessandro Puliti said the combined group would have about 20% market share in the Middle East and Latin America, and some 22% in the North Sea, based on revenue.
"Those are percentages that should not worry the authorities," he added, answering a question about a risk of anti-trust approval hurdles.
While the two mainly operate in different regions, they compete for contracts in Brazil, a growing offshore oil and gas market.
The two partners aim to reach a binding merger agreement by mid-2025 with completion expected in the second half of 2026.
SPECIAL DIVIDEND
Their shareholders will each own 50% of the combined company's share capital.
Siem Industries, controlled by Norwegian billionaire Kristian Siem, would have a stake of about 11.9%, while Italian energy group Eni and state investor Cassa Depositi e Prestiti would own about 10.6% and 6.4%, respectively.
Subsea7 shareholders will receive 6.688 Saipem shares for each share they hold, the companies said in a statement.
Subsea7 will also pay an extraordinary dividend of 450 million euros just before closing the deal.
"The combined business will create cost savings and a strengthened, integrated offering, particularly in offshore," Citi analysts said in a note for clients, adding the merger could boost 2025 and 2026 payouts for shareholders.
The firms expect to generate annual benefits of around 300 million euros from the third year after completion, mainly through cost savings, thanks to fleet optimisation, unified procurement, sales, and marketing.
Saipem CEO Puliti will lead the combined business while Subsea7's Evans is expected to lead its offshore operations.
Subsea 7 and Saipem held talks over a possible tie-up several years ago, but failed to reach an agreement.
($1 = 0.9547 euros)
(Reporting by Francesca Landini in Milan and Nerijus Adomaitis in Oslo; editing by Valentina Za and Jason Neely)
The article discusses the merger between Saipem and Subsea 7 to form a leading offshore energy services company.
The merger aims to create cost savings, a strengthened offering, and a significant market share in key regions.
Saipem CEO Alessandro Puliti will lead Saipem7, with Subsea 7's John Evans overseeing offshore operations.
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