Nov. 5 (splash234.com) razil’s competition watchdog CADE has given conditional approval to the proposed merger between Italian offshore engineering giant Saipem and Norway’s Subsea 7, requiring the companies to sell a specialised pipelay vessel to address competition concerns.
The Brazilian regulator approved the combination, which will create Saipem7, after the companies agreed to divest the Seven Borealis, a vessel capable of operating in deepwater and ultra-deepwater projects.
CADE raised concerns that the merger would eliminate competition between two major contractors in Brazil’s subsea engineering, procurement, construction and installation market, particularly for projects involving Petrobras and the country’s prolific pre-salt fields.
The agreement also includes provisions to ensure the buyer can compete for future offshore contracts while protecting the execution of projects already in the companies’ backlog.
Saipem and Subsea 7 said the disposal would not materially affect the merger’s strategic rationale or the previously announced annual synergies of approximately €300m ($338m).
The two companies signed a binding merger agreement in July 2025 following an initial agreement earlier that year. The proposed combination will create an offshore engineering powerhouse with annual revenues of approximately €21bn ($23.6bn) and a combined backlog of €43bn ($48.5bn).
However, the Brazilian clearance does not complete the regulatory process. The European Commission launched an in-depth investigation into the deal in July, raising concerns about reduced competition in the market for subsea umbilicals, risers and flowlines. Brussels subsequently suspended its review in August while awaiting additional information from the companies.
The transaction also remains subject to regulatory scrutiny in Australia, where the competition authority is conducting a detailed assessment of its potential impact on offshore engineering services.
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