CGGVeritas (Paris:GA) (NYSE:CGV) announced today that it has entered into an agreement with Fugro to acquire Fugro’s Geoscience Division, excluding the existing Multi-Client library and nodes businesses.
With this transformative agreement, CGGVeritas will become a fully integrated Geoscience company establishing a leading position in the fast growing high-end integrated geology and geophysics and reservoir market. The transaction will also strengthen and extend its existing equipment and acquisition businesses, in particular with the addition of four high-end 3D vessels.
The agreement also includes strategic partnerships which will benefit from the leading positions both parties have in their respective markets:
- The creation of a Seabed Joint-Venture, a focused global leader in the rapidly growing Seabed acquisition market, which will be 60%-owned by Fugro after payment of €225 million to CGGVeritas.
- A commercial agreement for CGGVeritas to sell Fugro’s existing Multi-Client data, which remains owned by Fugro.
- A global strategic technical and commercial mutual preferred supplier agreement.
- A major step forward in field development and in reservoir capabilities, with strong recognized brands and immediate access to new clients
- An accelerated move to a less cyclical business and low capital intensive geoscience consulting services
- The addition of high-tech reservoir characterization and modeling software and services, complementing the Hampson-Russell business
- Provision of high-end integrated solutions from exploration to production
- Immediate access to high-end Marine vessels at a time of market recovery. A sound alternative to new builds while keeping industry capacity constant
- Creation with our partner Fugro of a global leader in the rapidly growing Seabed Acquisition services market
- An increased Multi-Client footprint through access to new libraries and reinforced marketing teams
- A complementary position in equipment with the De Regt products
- The addition of high skilled personnel where expertise is a key success factor
- The addition of acquisition services businesses: Airborne, Marine EM, Marine Magnetics & Gravity
- Scale savings and incremental productivity of the global fleet
- Technology and commercial leverage across the geosciences
- Additional sales expected from the preferred supplier agreement
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