Two major oil services companies have agreed to a $13bn merger as they consolidate and cut costs to cope with the effects of a prolonged low oil price. Technip, which is listed in France, and FMC, the US-based company, said on Thursday they would merge their operations to create a new company called TechnipFMC, which will be dual listed in Paris and New York. It will be domiciled in London, with other headquarters in Houston and Paris. The new company will be worth $13bn, based on the most recent closing prices for each company. Shareholders in each group will receive 50 per cent of the stock of the new company.
Doug Pferdehirt, the president of FMC Technologies, will be the chief executive of TechnipFMC, while Thierry Pilenko, Technip CEO, will become chairman of the board. Technip, Europe’s biggest oil and gas services group by market capitalisation, has been trying to do a deal with another group for the past two years to diversify its pipes and oil infrastructure construction business. In 2014, the Paris-based company abandoned a €1.47bn unsolicited takeover offer for CGG, a French seismic surveyor that uncovers and determines the size of hydrocarbons reserves.