McDermott gets FTC clearance for $6bn merger with CB&I

Engineering, procurement, construction and installation (EPCI) services company McDermott International has secured an approval from the US Federal Trade Commission (FTC) for its previously announced $6bn merger with CB&I.

FTC granted an early termination of the waiting period under the 1976 Hart-Scott-Rodino Antitrust Improvements Act, regarding the proposed combination.

Last month, the companies reached a merger agreement to create a fully vertical integrated onshore-offshore company.

Upon completion of the deal, McDermott stockholders will own 53% of the combined entity on a fully diluted basis, while the remaining 47% will be held by CB&I shareholders.

At the time of signing the agreement, McDermott International president and CEO David Dickson said: “Customers worldwide increasingly seek a single company that can offer end-to-end solutions, and the combination of McDermott and CB&I responds to these evolving customer needs by creating a leading vertically integrated company.

“This transaction combines two highly complementary businesses to create a leading onshore-offshore EPCI company driven by technology and innovation, with the scale and diversification to better capitalise on global growth opportunities.”

The merger is conditional upon regulatory clearance in Russia, approval by McDermott’s and CB&I’s shareholders, as well as completion of financing and other closing conditions.

Through the transaction, McDermott intends to create annualised cost synergies of $250m next year.