Aker Solutions is to split into two separate companies to speed up a bid to reduce costs via streamlining and "better position" the business in an increasingly competitive global energy industry.
The subsea, umbilicals, engineering and maintenance, modifications and operations (MMO) units will become a new business, taking the Aker Solutions name.
This unit will be streamlined to focus on the fast-growing deepwater and subsea oil-services markets and in areas with operational, commercial and strategic similarities.
The other units, including drilling technologies, Aker Oilfield Services and process systems, will be developed independently, as part of a new oilfield services investment company, to be called Akastor.
This will give them greater strategic freedom to develop individually through organic growth and transactions, said Aker Solutions.
The split, which will be carried out as a spin-off of the new Aker Solutions, is expected to happen around the end of September. Both companies will be listed on the Oslo stock exchange.
Luis Araujo, the regional president for Aker Solutions in Brazil, will be CEO 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.
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.
"We are taking a major step in a transformation that began 12 years ago with the merger of Kværner and Aker Maritime," said executive chairman Øyvind 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.
"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."
Aker Solutions said the new Aker Solutions company will have a simpler strategy focused on value creation through technological development, organic growth and operational excellence. It will be 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.
Under Akastor, the drilling technologies, Aker Oilfield Services, process systems, surface products and business solutions businesses will be developed as largely independent entities with management teams, boards of directors and strategies.
Drilling Technologies will be the largest business within Akastor, accounting for about 60% of the earnings and workforce.
"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.
The transaction had 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.
Ex-Aker intervention firm restructures, 1 April 2014