McDermott and CB&I Complete Merger
Following shareholder approvals, US engineering and construction groups McDermott International and Chicago Bridge and Iron (CB&I) have completed their merger into a fully integrated provider of technology, engineering and construction solutions for the energy industry.
In accordance with the agreement announced in December 2017, McDermott’s shareholders hold 53% of the combined company and CB&I’S shareholders the rest. David Dickson, CEO of McDermott, will head retain his position, and the new McDermott's headquarters will remain in Houston. Gary P. Luquette, will continue as non-executive chairman of the board of directors.
The combined operations will have revenues of about $10 billion and a backlog of work totaling about $14.5 billion, the merger partners said earlier. Annualized cost savings of $250 million are forecast for the first business year, 2019.
The deal, which the companies value at $6 billion including debt, will give McDermott access to major LNG infrastructure projects in the US as part of a wave of new petrochemical projects based on shale gas-derived feedstock. CB&I belongs to a consortium working on f the Freeport LNG project in Texas and the Cameron LNG export plant in Louisiana. Both projects have been delayed.
Already an established player in the Middle East, the added strength through the merger will allow McDermott it to expand in Saudi Arabia. Among the contractor’s customers is national oil company and petrochemicals group Saudi Aramco.