The $13 Billion Technip-FMC Merger
Deal overview
· Merging Parties: Technip S.A. (France) and FMC Technologies, Inc. (United States)
· Total Transaction Size: Approximately $13 billion
· Close Date: 16 January 2017
· New Entity: TechnipFMC plc, incorporated in England & Wales
· Operational headquarters : Paris, Houston, and London
Company Details : Technip
· Acquirer : Technip S.A.
· Founded: 1958, France
· Founder: IFP Énergies nouvelles
· CEO at time of deal: Thierry Pilenko
Technip was a major global EPC (Engineering, Procurement and Construction) for the energy industry, recognised for its expertise in offshore platforms, subsea infrastructure, LNG facilities and large petrochemical projects. In practical terms, Technip’s work consisted in designing and building major energy infrastructure around the world. For instance, the company constructed offshore platforms that allow oil and gas to be extracted at sea and built underwater pipelines connecting offshore fields to onshore facilities. Technip was also heavily involved in liquefied natural gas (LNG) projects, notably by building large industrial plants that transform natural gas into liquid form so it can be transported by ship across long distances.
Prior to the merger, the company operated in 48 countries with over 37,500 employees, generating €10.7 billion in revenue in 2014. Known for its strong engineering capabilities and technological development particularly in subsea systems and flexible pipe technology, Technip built a reputation for delivering complex, multi-billion-dollar projects worldwide. Although the company faced compliance issues, it remained a leading force in energy infrastructure and innovation leading up to its combination with FMC Technologies. The compliance issue referred to a 2010 settlement under the U.S. Foreign Corrupt Practices Act (FCPA), a federal law that prohibits companies from bribing foreign public officials to obtain or retain business. In this case, Technip was accused of having participated, alongside other international firms, in a long-running scheme involving improper payments to Nigerian officials in connection with the award of contracts for the construction of liquefied natural gas (LNG) facilities in Nigeria.
Company Details : FMC
· Target : FMC Technologies
· Founded: 2000, Houston, Texas (United States)
· Founder: Spin-off from FMC Corporation
· CEO at the time of merger: Douglas J. Pferdehirt
FMC Technologies was a leading provider of subsea production systems and surface technologies essential for offshore oil and gas development. With around 17,400 employees in 2015 and operating in more than 20 countries, the company was well known for its engineering strength and innovations.Concretely, FMC Technologies designed and supplied the equipment placed on the seabed to extract oil and gas from deep underwater fields. This included advanced “subsea trees” used to control wells on the ocean floor, as well as electronic systems that allowed operators to monitor and manage production remotely. These technologies made it possible to develop oil and gas fields located in very deep waters that would otherwise have been too complex or costly to exploit. FMC Technologies invested significantly in research and development to support its advanced subsea technologies, earning a reputation for its technical excellence among international operators. Despite facing market pressures during the 2014–2016 oil price downturn, its deepwater expertise and strong client relationships made it a strategic fit for merger with Technip to create an integrated subsea and engineering powerhouse.
The Merger
The merger aimed to create a global leader in oil and gas projects, technologies, and services by combining the strengths of both firms. It sought to offer a “subsea fully-integrated supplier”, strengthen the capital structure, and enhance competitiveness in a challenging oil-price environment.
Technip and FMC Technologies officially announced their intention to merge on 19 May 2016, framing the transaction as a genuine merger of equals with balanced ownership, equal board representation and shared executive responsibility. In this context, a merger of equals refers to the combination of two companies of comparable size and influence, where neither is explicitly acquiring the other and where governance structures demonstrate symmetrical power-sharing between the two entities.
Structurally, the transaction was executed as an all-stock deal: each Technip share was exchanged for two new shares in TechnipFMC, and each FMC share was exchanged for one new share in TechnipFMC, resulting in shareholders holding approximately 50% each of the merged company. At closing, the combined market capitalization was roughly US$13 billion, with a total workforce of about 49,000 employees and combined revenues of approximately US$20 billion.
The legal structure of the merger was complex. It involved a cross-border merger under UK law, enabling Technip, a French company, to merge into a newly formed entity incorporated in England and Wales. Moreover, incorporation under English law provided a flexible legal framework and offered a neutral jurisdiction for both parties.
The merger was followed by a domestic transaction under Delaware law, in which FMC Technologies merged with a newly created subsidiary of TechnipFMC. The resulting parent company, TechnipFMC plc, was legally domiciled in the United Kingdom but maintained three operational headquarters: Paris, hosting the Executive Chairman’s office; Houston, serving as the base for the Chief Executive Officer; and London, which housed the former Forsys Subsea joint venture headquarters and served as the company’s registered office.
The merger became legally effective on 16 January 2017, and TechnipFMC shares began trading the next day.
Legal Implications
The merger successfully obtained all regulatory approvals. The Chancery Division of the High Court of Justice of England and Wales validated the cross-border structure in December 2016. The French Autorité des marchés financiers granted approval of the prospectus in January 2017, allowing the company to be listed on Euronext Paris and by the EU Prospectus Directive. The U.S. Securities and Exchange Commission declared the registration statement on Form S-4 effective, clearing the transaction from a U.S. securities law perspective. No major antitrust objections emerged, as the combined entity did not raise concerns of dominance comparable to those often observed in other industrial sectors. For comparison, mergers in other industrial sectors such as Exxon/Mobil in 1999 in oil refining and distribution, or BASF/Solvay in 2019 in chemicals faced stricter regulatory scrutiny by the EU Commission due to potential concentration effects.
The Technip-FMC merger illustrates the complex legal architecture of cross-border mergers of equals, particularly in sectors with high technological and regulatory demands.
Structurally, it combined a UK cross-border merger with a Delaware domestic merger, allowing a flexible framework to accommodate shareholders in France, the U.S., and other jurisdictions, while enabling dual listing on Euronext Paris and the NYSE. However, in 2022 the company voluntarily delisted from Euronext Paris, with its last trading day on that market on 17 February 2022, so that all remaining trading would occur on the NYSE, reflecting a strategic decision to align the shareholder base and reduce the costs of the burden of a dual listing.
Contractual mechanisms also played a crucial role in the legal architecture of the deal. The merger agreement included extensive risk disclosure obligations, outlining potential integration, market, and regulatory risks for shareholders, a standard feature in cross-border mergers to mitigate liability under securities laws.
The eventual demerger of TechnipFMC into two independent entities : TechnipFMC (subsea technologies) and Technip Energies (engineering and LNG projects) also reflects the legal flexibility in the original merger documents. Cross-border merger agreements frequently incorporate provisions enabling post-closing corporate restructuring, including spin-offs, carve-outs, or divestitures, to protect long-term shareholder value and respond to unforeseen market developments. A spin-off occurs when a company creates a new, independent entity by separating part of its business and distributing shares of the new company to existing shareholders, typically used when a business unit has different strategic goals, risk profiles, or capital needs from the parent company. Carve-outs are similar, but instead of distributing shares to existing shareholders, a portion of the business is sold to outside investors or floated on the market, enabling the parent company to raise capital or streamline operations while retaining partial ownership. Divestitures, by contrast, consist of the complete sale of a business unit or specific assets to another company, often for strategic, regulatory, or financial reasons, such as underperformance, antitrust concerns, or misalignment with long-term strategy. They serve to protect long-term shareholder value by ensuring that the merged company can adapt if the original integration plan does not deliver the expected benefits, as illustrated by TechnipFMC’s split into two independent entities.
Finally, compliance and anti-corruption issues have played a significant role in the company’s recent history. Indeed, in 2019, the company agreed to pay more than 301 million dollars to U.S. and Brazilian authorities to resolve corruption allegations involving former business activities in Brazil. In 2023, TechnipFMC acknowledged corruption practices in Ghana and Equatorial Guinea and accepted to pay nearly 180 million euros in fines to French authorities, while its spin-off Technip Energies received a separate fine of 29.45 million euros. While these issues originated before the merger, the combined entity inherited responsibility for compliance and internal controls. Indeed, in mergers and acquisitions, a successor entity typically assumes not only the assets and contracts of its predecessors but also their legal obligations and liabilities, unless specific carve‑outs are negotiated. This means that when Technip S.A. and FMC Technologies combined to form TechnipFMC, the new company stepped into the legal shoes of both predecessors, making it responsible for ongoing or unresolved legal matters, including anti‑corruption enforcement actions.This situation emphasizes the necessity for solid due diligence and post-merger integration of the compliance landscape. Failure to harmonize such controls could expose the merged company to enforcement actions, civil liabilities, and reputational damage, such as government fines, lawsuits from shareholders, or public scandals all of which carry both legal and business consequences.
Post-Merger Evolution : From Promising Start to Unstable Performance
In the period immediately following the merger, TechnipFMC reported strong initial results. Synergies materialised quickly, and by early 2018, the company announced that quarterly profits had nearly quadrupled, with approximately 100 million euros in pre-tax synergies realised. Revenue increased by almost eight percent year-on-year, reflecting improved market conditions and the first benefits of the integrated subsea model. CEO Doug Pferdehirt highlighted the company’s growing deployment of its integrated Engineering, Procurement, Construction and Installation (iEPCI) model, as well as the expanding adoption of its Subsea 2.0 technologies. The company also reported a robust pipeline of front-end engineering design work, particularly in the LNG market.
Despite these early successes, stock performance faced significant instability. Within two years, the company’s share price had lost nearly 40 percent of its value. Analysts pointed to mixed performance across business segments, deteriorating margins in subsea activities and market concerns about long-term strategy. Union reports indicated that the activities inherited from FMC Technologies generated significantly lower margins than those inherited from Technip, calling into question the assumption that the merger would create lasting benefits across different business areas.
A Merger Tormented by Controversies
The merger quickly became controversial, especially in France, where employees and unions expressed strong concerns about governance and strategic orientation. While the deal had been advertised by Thierry Pilenko as a merger between equals, numerous French employees soon felt that control had leaned decisively toward the American side. Reports indicated that eight of the twelve executive committee members were former FMC executives, including those occupying crucial strategic and operational positions. As a result, many senior figures from the former Technip organisation felt sidelined. Several high-level executives left the group, and unions accused management of having facilitated a de facto takeover rather than a balanced merger.
This perception intensified in 2019, when Thierry Pilenko left the company with severance payments amounting to approximately 14 million euros, which many stakeholders considered excessive at a moment when the group experienced financial losses exceeding 1.9 billion dollars. Critics argued that Pilenko had favoured the American side during merger negotiations, enabling FMC to secure disproportionate managerial control despite being the smaller company.
Labour unions which represent French employees such as CFDT and UGICT-CGTissued public statements in 2019 estimating that French employees had obtained no benefit from the merger. They noted that, in both 2017 and 2018, the operating margins of the subsea division, historically an FMC strength, declined considerably, while the onshore/offshore division inherited from Technip contributed the majority of profits. They further argued that the subsea division originating from Technip, particularly the SURF (Subsea Umbilicals, Risers, and Flowlines) activities, suffered from declining support and investment.
The controversies did not stop with internal governance. TechnipFMC also faced significant corruption scandals, as previously mentioned with the company’s fines and settlements for corruption in Brazil, Ghana, and Equatorial Guinea.
Strategic Reversal and the TechnipFMC Split
The difficulties of integrating two culturally, operationally and geographically distinct firms eventually led to a strategic reassessment. In August 2019, TechnipFMC’s board announced its intention to split the company into two independent and publicly traded entities, each focused on distinct business segments. One of these entities, TechnipEnergies, would specialise in engineering and construction for large-scale onshore and offshore projects, including LNG facilities, petrochemical complexes and other high-value energy infrastructure. The other entity, retaining the name TechnipFMC, would focus exclusively on subsea technologies and services.
This demerger, completed in 2021 after a temporary pause caused by the economic uncertainty of the COVID-19 pandemic, reflected the conclusion that the integrated model created in 2017 had not produced the long-term synergies or industrial stability expected. Nonetheless, CEO Doug Pferdehirt defended the spirit behind both the merger and the subsequent split, arguing that the formation of TechnipFMC in 2017 had been a success that enabled the company to undertake this strategic reorganisation from a position of strength.
The separation also had political and financial implications. Technip Energies attracted Bpifrance as a long-term shareholder, with the French public investment bank acquiring significant equity by purchasing shares divested by TechnipFMC. Meanwhile, FMC’s influence decreased as it gradually exited the capital of Technip Energies, marking a partial reversal of the power dynamics that had been criticised during the early years of the merged company.
Future Implications
The TechnipFMC merger and subsequent demerger illustrate the complexity of cross-border mergers of equals, particularly in industries where national identity, technological capabilities and workplace cultures play essential roles. The case shows that while structural remedies and balanced governance can be implemented on paper, the practical distribution of managerial influence often diverges over time. The mergers of equals approach, while often appealing, may reveal power asymmetries that only become visible after integration challenges emerge.
From a regulatory point of view, the deal provides an example of a large cross-border industrial merger that progressed smoothly through legal and antitrust processes in France, the European Union, the United Kingdom and the United States. Unlike many transatlantic mergers, no major competition concerns were raised. Yet the governance, cultural and strategic challenges that unfolded post-merger demonstrate that the absence of regulatory obstacles does not guarantee long-term stability or value creation.
For the companies involved, the future paths differ clearly. Technip Energies now positions itself as a major engineering firm with strong exposure to LNG and the energy transition, increasingly involved in low-carbon solutions and sustainable industrial development. TechnipFMC, by contrast, remains focused on subsea technologies, operating in a market still subject to unstable investment cycles and requiring continued innovation and cost competitiveness.