Subsea 7 offers USD 2 bn to buy McDermott, willing to go higher

Offshore oil services firm Subsea 7 has offered to buy US peer McDermott for about USD 2 billion, it said on Monday, adding that its approach had so far been rejected.

McDermott, which last year agreed to buy onshore-based engineering company Chicago Bridge & Iron (CB&I), could receive an even higher bid if it agrees to enter talks, Subsea 7 added.

"The proposal is subject to the termination of McDermott's pending transaction with CB&I," Oslo-listed Subsea 7 said in a statement.

The offer to pay USD 7 per share, either in cash or up to 50 percent of it in stock, represented a premium of 16 percent over Friday's closing share price of USD 6.05.

"Subsea 7 will consider increasing its proposed price upon further assessment of McDermott's business through discussions with McDermott management," it said.

"Additionally, for any stock consideration, Subsea 7 is open to discussing listing options for the shares of the combined company," Subsea 7 wrote.

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