CADE Approves Saipem-Subsea 7 Merger on Condition of Vessel Divestment

Brazil's Administrative Council for Economic Defense (CADE) approved the merger between Italy's Saipem and Norway's Subsea 7, which will give rise to a new company called Saipem7. The approval was conditioned on a merger control agreement requiring the companies to sell the pipelay and heavy-lift vessel Seven Borealis to address the competition concerns raised during the review.

The agreement requires that the buyer of the Seven Borealis be independent and receive prior approval from CADE itself, while also ensuring that the buyer can compete in the Brazilian market and continue projects already under contract. The Seven Borealis has an overall length of 182.2 meters, was built in 2012, is equipped with S-lay and J-lay systems, a 5,000-tonne main crane and two remotely operated vehicles, and is capable of operating in deepwater and ultra-deepwater depths of more than 1,500 meters. It is the only vessel with an S-lay/J-lay system among Subsea 7's four rigid-pipelay vessels classified as 'global enablers.'

The Brazilian regulator found that the transaction posed risks to competition in the engineering, procurement, construction and installation (EPCI) market for subsea systems, which is key to oil and gas exploration and production, particularly in Brazil's pre-salt, where Saipem and Subsea 7 are close competitors. CADE's tribunal had reopened its review in July after accepting appeals filed by Petrobras and the Brazilian Association of Oil and Gas Exploration and Production Companies (ABEP) against a prior unconditional clearance.

CADE's approval does not complete the merger's global regulatory process. The European Commission is conducting an in-depth investigation, whose deadline was extended to December 16 and later suspended pending additional information from the companies, while Australia's competition regulator has a determination deadline of December 22. Under the terms of the merger, all pending conditions must be satisfied or waived by December 31, 2026.

Saipem and Subsea 7 stated that the vessel divestment will not significantly affect the merger's strategic rationale or the annual synergies already announced to the market, estimated at around 300 million euros ($338 million). The companies signed a binding merger agreement in July 2025, following an initial agreement reached earlier that year, with the aim of creating an offshore engineering company with annual revenues of about 21 billion euros and a combined order backlog of 43 billion euros.