European Event-Driven Analyst

Jesus Rodriguez Aguilar

Event-Driven

On 17 July 2020, <a href="https://www.smartkarma.com/entities/aker-solutions-asa" target="_blank" data-smartkarma-citation="entities:22221:1" rel="noopener">Aker Solutions (AKSO NO) </a><a href="https://www.prnewswire.co.uk/news-releases/contemplated-merger-between-kvaerner-asa-and-aker-solutions-asa-809974355.html" target="_blank" rel="noopener">agreed to acquire </a><a href="https://www.smartkarma.com/entities/kvaerner-asa" target="_blank" data-smartkarma-citation="entities:24992:1" rel="noopener">Kvaerner ASA (KVAER NO)</a> in a transaction structured as a merger of equals (“statutory merger”), in which Aker Solutions will absorb Kværner.
Both oil-industry suppliers are controlled by Norwegian billionaire Kjell Inge Røkke, while Norway is also a shareholder in Aker Solutions. The declared rationale of the merger is to vertically integrate to become a stronger player in the global energy industry. Both companies have been hit by the reduction of capex among the oil companies and drilling contractors, in the wake of the coronavirus crises. Røkke seeks to unlock synergies in a leaner company and win business opportunities in renewable energies.
Shares in Oslo-listed Aker Solutions closed 34.2% higher, while Kværner’s shares closed 7.7% higher. The combined market cap edged 21.8% higher (NOK 6,358 mn at closing prices of Friday).
With the same majority shareholder in both companies and the acquiescence of Norway, cost synergies (8.5% of FY 2019 operating expenses), larger market cap and higher liquidity, this defensive deal has all the elements to succeed. I will update this situation if and when new information arises.
Read on for more details.

On 17 July 2020, Aker Solutions (AKSO NO) agreed to acquire Kvaerner ASA (KVAER NO) in a transaction structured as a merger of equals (“statutory merger”), in which Aker Solutions will absorb Kværner.
Both oil-industry suppliers are controlled by Norwegian billionaire Kjell Inge Røkke, while Norway is also a shareholder in Aker Solutions. The declared rationale of the merger is to vertically integrate to become a stronger player in the global energy industry. Both companies have been hit by the reduction of capex among the oil companies and drilling contractors, in the wake of the coronavirus crises. Røkke seeks to unlock synergies in a leaner company and win business opportunities in renewable energies.
Shares in Oslo-listed Aker Solutions closed 34.2% higher, while Kværner’s shares closed 7.7% higher. The combined market cap edged 21.8% higher (NOK 6,358 mn at closing prices of Friday).
With the same majority shareholder in both companies and the acquiescence of Norway, cost synergies (8.5% of FY 2019 operating expenses), larger market cap and higher liquidity, this defensive deal has all the elements to succeed. I will update this situation if and when new information arises.
Read on for more details.

Norway

Kvaerner ASA offers engineering, procurement and construction services.  The Company serves oil and gas operators, industrial companies and other engineering and fabrication companies.

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Kvaerner ASA (KVAER NO)

Aker Solutions - Kværner Agreed Merger

On 17 July 2020, Aker Solutions (AKSO NO) agreed to acquire Kvaerner ASA (KVAER NO) in a transaction structured as a merger of equals (“statutory...

Jesus Rodriguez Aguilar

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