McDermott, CB&I to merge

McDermott International Inc. and CB&I have agreed to combine in an all-stock transaction valued at about $6 billion.

End-to-end integrated offering of the combined McDermott and CB&I
End-to-end integrated offering of the combined McDermott and CB&I

Offshore staff

HOUSTON and THE WOODLANDS, TexasMcDermott International Inc. and CB&I have agreed to combine in an all-stock transaction to create a vertically integrated onshore-offshore company, with an engineering, procurement, construction, and installation (EPCI) service offering and technology portfolio.

Upon completion of the transaction, McDermott shareholders will own about 53% of the combined company on a fully diluted basis and CB&I shareholders will own 47%.

The estimated enterprise value of the transaction is approximately $6 billion, based on the closing share price of McDermott on Dec. 15, 2017. The transaction includes CB&I’s Technology business and former Engineered Products business.

The transaction has been approved by the boards of both companies and is expected to be completed in 2Q 2018. It remains subject to regulatory antitrust approvals, approval by McDermott’s and CB&I’s shareholders and other customary closing conditions.

Following completion of the transaction, the combined company will be headquartered in the Houston area.

David Dickson, current president and CEO of McDermott, will be president and CEO of the combined company, and Stuart Spence, current executive vice president and CFO of McDermott, will be executive vice president and CFO of the combined company. Patrick Mullen, president and CEO of CB&I, will remain with the combined company for a transition period. Operational leadership will include representatives from both companies.

The board of directors will be comprised of 11 members, including 10 independent directors and David Dickson. Five of the independent directors will come from McDermott and five will come from CB&I. Gary P. Luquette, non-executive chair of the McDermott board, will serve as the combined company’s non-executive chairman.

12/19/2017

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