Thursday, July 14, 2011
Odfjell Drilling AS
Odfjell announced the merger between Odfjell Well Management (OWM) and Ross Offshore (RO). Ross Offshore acquires the two Odfjell Drilling companies Odfjell Well Management AS and Odfjell Well Management Consultants AS. The name of the combined company will be Ross Offshore.
The combination of Odfjell Well Management and Ross Offshore will provide clients with a spectrum of services from qualified professionals to assuming the role as the "in-house" drilling and well department. The services of total well management comprise planning, operations, logistics, project-management, cost control, HSE, authority applications and marine management. With this broad service offering, Ross Offshore will be well positioned to serve its clients with the complete value chain.
Drilling activity on the NCS is expected to increase significantly over the next 3-4 years, which supports a strong underlying growth in the well management and the consultancy outsourcing market. Further, there is a growing focus on Carbon Capturing and Storage. The range of growth opportunities in the coming strong market is large, and Ross Offshore has now secured a good position to capture on these opportunities.
Peder Sortland, currently the CEO of Subsea Technology Group (STG) and also in his capacity as the designated CEO of the combined business, expresses satisfaction that the owners of the two companies have agreed to join forces based on sound industrial logic. The merger is strongly supported by the management of RO and OWM as well as STG.
Furthermore, Bjornar Iversen, Executive Vice President of Business Development in Odfjell Drilling, expressed, "By joining forces, this merger will create a focused company positioned to be a leading provider of well management and subsurface competence in Norway with international potential. This enhanced platform will enable us to better serve the needs of our jointed customers and provide them with existing capabilities, a more complete service offering and a broader resource base."
Post the transaction, STG and Odfjell Drilling will, through a joint holding company control approximately 40% each of the combined business whilst the balance will be held by minority shareholders. Prior to this transaction Ross Offshore has been owned 69% by STG. STG is again predominantly owned by the oil and gas specialist private equity investor HitecVision. OWM and its subsidiary OWMC have been owned by Odfjell Drilling Technology Ltd.
The combined business will have revenue of approximately NOK 530 million, and close to 200 employees and consultants. The head office of the combined business will be in Stavanger. The purchase price is not disclosed. The transaction is subject to customary approval by the Norwegian Competition Authority. Expected closing of the transaction is medio August.
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