Engineering firm TechnipFMC’s board of directors has approved a plan to separate into two companies
The board unanimously voted in favour of a plan to split the company into an engineering and construction provider (SpinCo) aimed at capitalising on the global energy transition, and an integrated technology and services provider (RemainCo) aimed at driving energy development.
The transaction is expected to be structured as a spin-off of TechnipFMC and will be headquartered in Paris, France. The separation is expected to be completed in H1 2020, with all outstanding shares of the spinoff to be distributed to existing TechnipFMC shareholders.
SpinCo will have roughly 15,000 staff and will comprise the current onshore/offshore segment of TechnipFMC, with a focus on LNG and future growth in areas such as biofuels, green chemistry and other energy alternatives. It will include TechnipFMC’s Genesis front-end engineering and design arm, the cryogenic transfer loading arm segment, currently part of the surface technologies department, and Cybernetix, a process automation-focused subsidiary that is currently part of the subsea arm of the business.
RemainCo will have roughly 22,000 staff and would be a fully integrated technology and services provider focused on energy development. The company will apply TechnipFMC’s integrated subsea development model to surface technologies.
TechnipFMC chairman and chief executive Doug Pferdehirt said “Since creating 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.”