The CEO of Italy's Saipem group stated on Wednesday that the rationale behind a merger of Italy's Saipem with Norway's Subsea 7 was to combine fleets to better serve customers and reduce costs.

On Sunday, the two companies announced their intention to merge in order to create a world leader in offshore energy service.

The combined group will not be approved by authorities until the second half 2026. It will have around 60 vessels that can serve the upstream industry, offshore drilling and installation, as well as decommissioning.

Alessandro Puliti, Saipem's Chief Executive, said in a press conference that the strategic rationale for combining Subsea 7 and Saipem fleets is to better serve customers, faster, and with lower costs.

He said that the legacy projects of the group would either be completed or nearly completed by the time the tie-up is operational, so they are not the main driver for the deal.

Saipem faces obstacles in completing an offshore wind project in France at Courseulles-sur-Mer and in a contract with Thai Oil to expand a refinery.

Saipem executives, commenting on the full-year results announced late Tuesday, said that the group booked provisions for the risks associated with two projects in the final quarter.

The Italian group expects to finish its scope of works for the French offshore project next year, a year later than the original schedule.

Analysts were informed that the costs for these two projects have already been included in Saipem's financial projections.

(source: Reuters)