Kværner ASA and Aker Solutions AS have entered into a merger plan, whereby the two entities will join forces to create a new supplier company with a stronger position as a solid execution partner, enabling sustainable, low-carbon oil and gas production, and accelerating growth in renewable energy industries. Kjetel Digre will be the CEO of the consolidated company.

Kvaerner and Aker Solutions have for many years been successful suppliers to customers operating energy production facilities, especially to oil and gas companies. Customers in this market are increasingly asking for solutions with reduced environmental footprint, and new customers ask for renewable energy solutions.

“By combining the two companies and their complementary resources, we will be able to deliver a more complete offering to a global energy industry,” says Leif-Arne Langøy, current chairman of Kvaerner and also the proposed chairman for the new combined company.

The merger is based upon the principle of equality. The merger will create an organisation with the required size and financial strength to compete and succeed in the growing market for renewable and sustainable energy, and generate value for shareholders, customers and society. The consolidation will take the form of a statutory merger whereby Aker Solutions ASA will absorb Kværner ASA, in accordance with the Norwegian Public Limited Liability Companies Act.

A dedicated supplier

The combined company will leverage industrial software and digital technology to optimise output and improve efficiencies in customer projects and operations. The merged entity will be a dedicated supplier that adds value by offering early front-end customer engagement, concept and system solutions for renewables and decarbonization projects in offshore wind, carbon capture, utilization and storage, electrification and emerging energy segments such as hydrogen. The combined company will utilize its global footprint in brownfield services and subsea to enter international renewables markets.

Furthermore, the merged entity will do fabrication at own facilities or in cooperation with partners around the world. The two companies’ solutions and technologies provide a stronger offering of renewable energy solutions​.

“The combined entity will be a dedicated execution partner for delivery of complete projects for new energy production facilities, for example oil and gas production platforms or subsea systems, or offshore wind power installations”, says Kjetel Digre, Aker Solutions’ onboarding CEO and also the proposed CEO for the combined company.

“We will continue to finetune and improve our internal capacities, to ensure that we always have a sound capacity utilisation. In addition to our own capabilities, we will continue to collaborate closely with partners,” Digre continues.

Aker Solutions had at the start of 2020 approximately 16 000 own employees, and Kvaerner had about 2 800. As an adaption to changing markets, both companies have prior to the merger, commenced necessary adjustments of capacities, costs and positions. Most of the staff reductions will be completed before the merger is implemented. The combined cost-cutting initiatives aim to reduce the fixed cost-level by about NOK 1.5 billion on an annualized basis, from 2019 until 2021.

“Combining Aker Solutions and Kvaerner in one company will bring together expertise and innovative spirit of two strong and compatible cultures, to create value for customers, shareholders, societies and employees. This is the right move for the future”, says President and CEO of Kvaerner, Karl-Petter Løken.

About the new company

The combined company will have about 15 000 employees in more than 50 locations around the world. It will have about 8 000 employees in Norway. Combined 2019 revenues for the companies were NOK 38 billion, with an EBITDA of NOK 2.7 billion (including special items).

The new entity will have operations in about 25 countries. This includes offices for concept development, engineering and project execution, as well as effective fabrication yards and facilities for manufacturing of advanced equipment.

In the planned merger process, a new organisation model will be established. Kvaerner’s CEO, Karl-Petter Løken will be a member of the new company’s Executive Management Team, and will assume responsibility for the Renewables segment. Idar Eikrem will take on the role as of CFO in Aker Solutions from 1 August 2020. Other key management positions will be concluded during the coming weeks.

Øyvind Berge in Kvaerner’s finance department will from 1 August act as CFO in Kvaerner until the merger of Kvaerner and Aker Solutions is completed in November. Berge has long experience from leading positions in Aker and Kvaerner, and has previously held the position as CFO for Kværner Stord AS and Kværner International AS. More recently Berge has acted as Senior Vice President for Business Controlling in Kvaerner.

About Kvaerner

Kvaerner is a project execution specialist and a trusted advisor for our customers. We provide engineering, procurement and construction (EPC) services and deliver advanced offshore and onshore installations around the world.

We have offices in seven countries and approximately 2 800 employees. Health, Safety, Security and Environment (HSSE) has the highest priority in our work, and we aim to deliver technology and solutions in a safe and sustainable way. Our passion, experience and expertise realise values for customers and societies. Kværner ASA, through its subsidiaries and affiliates (“Kvaerner”), is an international contractor and preferred partner for operators and contractors within oil and gas, renewable energy and in the field of engineering and fabrication.

About Aker Solutions

Aker Solutions helps the world meet its energy needs. We engineer the products, systems and services required to unlock energy. Our goal is to maximize recovery and efficiency of oil and gas assets, while using our expertise to develop the sustainable solutions of the future. Aker Solutions employs approximately 15,000 people in more than 20 countries.