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Aker Solutions Splits
to Boost
Competitiveness and Value Creation
April 30, 2014 + + +
Aker Solutions will split into two companies to speed up a streamlining
process that will reduce costs and better position all parts of the group
to meet the needs of customers in an increasingly competitive global
energy industry.
The Subsea, Umbilicals, Engineering and
Maintenance, Modifications and Operations (MMO) areas will form a new
company under the Aker Solutions name. The company will be more
strategically aligned, have a narrower focus and deeper synergies to
strengthen its leading position through its unique subsea technology and
state-of-the-art offshore field design.
The other units, including
Drilling Technologies, Aker Oilfield Services and Process Systems, will be
developed independently as part of a new oil-services investment company,
named Akastor. These business areas, which have significant operational,
technological and commercial differences, will have greater strategic
freedom to develop individually through both organic growth and
transactions.
The split, which will take place as a spin-off of the
new Aker Solutions, is scheduled to occur around the end of September.
Both companies will be listed on the Oslo stock exchange.
"The new
Aker Solutions will be a leaner and more focused company that will be able
to offer customers the unique and cost-effective technology and design
they need to succeed," Executive Chairman Øyvind Eriksen said. "The
company will, through a commitment to operational excellence and organic
growth, be better placed to build on its leading position in the fastest
growing areas of the global energy markets."
Shareholders will get
one new Aker Solutions share for each stock held in the existing company
at the time of the separation. They will also keep their shares in the
remaining business, which will be renamed Akastor at the time of the
split, ensuring that the existing shareholder structure is implemented in
each company.
The transaction has met with approval from Aker
Solutions' largest shareholders, Aker Kværner Holding and Aker ASA. An
extraordinary general meeting will be held in August to vote on the
separation.
"We are taking a major step in a transformation that
began 12 years ago with the merger of Kværner and Aker Maritime," said
Eriksen. "After this transaction and the 2011 Kværner spin-off, we will
have created three distinct companies to service the global energy
industry, providing offshore construction, unique subsea technology and
field design and oilfield services. We have also divested NOK 12 billion
in assets as part of the process."
New Management
Luis Araujo,
the regional president for Aker Solutions in Brazil, will be chief
executive officer of the new Aker Solutions. Frank Ove Reite, currently
managing partner at Converto, will become CEO of Akastor. Øyvind Eriksen
will remain chairman of the board of Aker Solutions.
"While I will
continue to play an active role as chairman, it is time for new leadership
to take these companies forward," Eriksen said. "Luis has proved more than
capable in managing our expansion in Brazil and will provide inspired
leadership as the new Aker Solutions builds on its success in the subsea
and deepwater markets. Frank has a long experience within the Aker group
and is excellent at developing businesses and pushing them toward their
full potential. I look forward to working closely with Luis and Frank to
unlock the great values in both companies."
Leif Borge, current
chief financial officer of Aker Solutions, will be CFO of Akastor. Svein
Oskar Stoknes, who heads the subsea area's finance function, will take on
the role as CFO of the new Aker Solutions.
Synergies
The new
Aker Solutions will be streamlined to focus on the fast-growing deepwater
and subsea oil-services markets and in areas with operational, commercial
and strategic similarities. There will be a swifter realization of
synergies as the subsea and field design areas share the same customers
and main markets. The company will have a simpler strategy focused on
value creation through technological development, organic growth and
operational excellence. It will be uniquely positioned to design, equip,
build and maintain the future subsea production factory and will build on
its expertise within project execution and offshore field design.
"The new Aker Solutions will benefit from greater synergies and a more
coordinated customer approach, leading to a stronger market position and
higher and more predictable returns on capital," said Eriksen.
The
Akastor management team has extensive experience in developing companies
and creating value through operations, restructuring and transactions. The
company will provide a structure where the businesses Drilling
Technologies, Aker Oilfield Services, Process Systems, Surface Products
and Business Solutions will be developed as largely independent entities
with management teams, boards of directors and strategies aimed at
maximising their value. Each company will have greater strategic and
transactional freedom because it will no longer be constrained by the
competing needs of other businesses. The entities will be able to focus
marketing efforts on core customers and invest strategically. Akastor will
also hold financial and real estate assets representing about 20 percent
of the company's balance sheet.
Drilling Technologies will be the
largest business within Akastor, accounting for about 60 percent of the
earnings and workforce.
"There is a strong industrial logic
underpinning this move," Eriksen said. "The businesses that will make up
Akastor have significant operational, technological and commercial
differences that have prevented them from achieving synergies with the
other businesses in Aker Solutions. Through this separation, we will be
able to more fully realize the industrial and return potential of all our
business areas and create value for our shareholders."
For further information, please contact:
Bunny Nooryani, Chief Communications Officer, Aker Solutions,
bunny.nooryani@akersolutions.com
Lasse Torkildsen, SVP Investor Relations, Aker Solutions,
lasse.torkildsen@akersolutions.com
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