McDermott International, Inc. (“McDermott”) (NYSE:MDR) today
announced that Glass, Lewis & Co., LLC. (“Glass Lewis”), a
leading independent proxy advisory firm, has joined Institutional
Shareholder Services Inc. (“ISS”) in recommending that McDermott
stockholders vote “
FOR” each of the proposals
relating to the combination with CB&I (NYSE:CBI) to be voted on
at the special meeting of stockholders on May 2, 2018.
In its report dated April 20, 2018, Glass Lewis states the
following:
“Combining with CB&I will enable the Company to fulfill
several key strategic objectives, namely, increasing its scale,
diversifying its business and geographic mix, and adding a
portfolio of proprietary technologies that could provide strong
differentiation. The Combination could also enable the combined
company to gain new revenue opportunities and generate meaningful
cost synergies, which in turn could help to drive EBITDA growth and
free cash flow generation.”i
“While we find that the combined company will initially have a
higher level of leverage than most of its peers, we believe that
the combined company’s leadership team has proven itself to be
capable of successfully navigating through such situations and
enhancing shareholder value. Further, the most recent preliminary
quarterly financial results from CB&I appear to us to
corroborate the Company’s view that the problem projects at
CB&I have been substantially de-risked.”i
“Based on these factors, and absent a superior available
alternative, we believe that the Combination is in the long-term
interests of McDermott shareholders and warrants support at this
time. Accordingly, we recommend that shareholders vote
FOR this proposal.”i
Commenting on the recommendations from ISS and Glass Lewis,
David Dickson, Chief Executive Officer of McDermott, said, "We are
pleased that both ISS and Glass Lewis support our transformational
combination with CB&I. We strongly urge all McDermott
stockholders to follow these recommendations and approve the
transaction so we can complete it expeditiously and begin to
realize the significant benefits it will deliver for our
stockholders and other stakeholders."
McDermott encourages its stockholders of record as of the April
4, 2018 record date to vote “FOR” each of the
proposals relating to the combination. Stockholders who have any
questions or need assistance voting their shares should contact
McDermott’s proxy solicitor, MacKenzie Partners, Inc., toll free at
(800) 322-2885.
The combination is expected to close in May 2018. It remains
subject to customary conditions, including approval by McDermott’s
and CB&I’s stockholders and other closing conditions.
About McDermott
McDermott is a leading provider of integrated engineering,
procurement, construction and installation (“EPCI”), front-end
engineering and design (“FEED”) and module fabrication services for
upstream field developments worldwide. McDermott delivers fixed and
floating production facilities, pipelines, installations and subsea
systems from concept to commissioning for complex Offshore and
Subsea oil and gas projects to help oil companies safely produce
and transport hydrocarbons. McDermott’s customers include national
and major energy companies. Operating in approximately 20 countries
across the world, McDermott’s locally focused and globally
integrated resources include approximately 11,800 employees, a
diversified fleet of specialty marine construction vessels,
fabrication facilities and engineering offices. McDermott is
renowned for its extensive knowledge and experience, technological
advancements, performance records, superior safety and commitment
to deliver. McDermott has served the energy industry since 1923,
and shares of its common stock are listed on the New York Stock
Exchange. As used in this press release, McDermott includes
McDermott International, Inc. and its subsidiaries and affiliates.
To learn more, visit our website at www.mcdermott.com.
Forward-Looking Statements
McDermott cautions that statements in this publication which are
forward-looking, and provide other than historical information,
involve risks, contingencies and uncertainties that may impact
actual results of operations of McDermott, including after the
proposed business combination with CB&I. These forward-looking
statements include, among other things, statements about the
anticipated benefits of the proposed combination, including
increasing scale, diversifying business and geographic risk, adding
technologies that could provide strong differentiation, new revenue
opportunities, meaningful cost synergies and enhanced stockholder
value, as well as statements about certain projects being derisked
and the expected timing for closing the proposed combination.
Although we believe that the expectations reflected in those
forward-looking statements are reasonable, we can give no assurance
that those expectations will prove to have been correct. Those
statements are made by using various underlying assumptions and are
subject to numerous risks, contingencies and uncertainties,
including, among others: the ability of McDermott and CB&I to
obtain the shareholder approvals necessary to complete the proposed
combination on the anticipated timeline or at all; the risk that a
condition to the closing of the proposed combination may not be
satisfied, or that the proposed combination may fail to close,
including as the result of any inability to obtain the financing
for the combination; the outcome of any legal proceedings,
regulatory proceedings or enforcement matters that may be
instituted relating to the proposed combination; the costs incurred
to consummate the proposed combination; the possibility that the
expected synergies from the proposed combination will not be
realized, or will not be realized within the expected time period;
difficulties related to the integration of the two companies; the
credit ratings of the combined businesses following the proposed
combination; disruption from the proposed combination making it
more difficult to maintain relationships with customers, employees,
regulators or suppliers; the diversion of management time and
attention on the proposed combination; adverse changes in the
markets in which McDermott and CB&I operate or credit markets;
the inability of McDermott or CB&I to execute on contracts in
backlog successfully; changes in project design or schedules; the
availability of qualified personnel; changes in the terms, scope or
timing of contracts; contract cancellations; change orders and
other modifications and actions by customers and other business
counterparties of McDermott and CB&I; changes in industry
norms; and adverse outcomes in legal or other dispute resolution
proceedings. If one or more of these risks materialize, or if
underlying assumptions prove incorrect, actual results may vary
materially from those expected. You should not place undue reliance
on forward-looking statements. For a more complete discussion of
these and other risk factors, please see each of McDermott’s and
CB&I’s annual and quarterly filings with the Securities and
Exchange Commission, including their respective annual reports on
Form 10-K for the year ended December 31, 2017. This publication
reflects the views of McDermott’s management as of the date hereof.
Except to the extent required by applicable law, McDermott
undertakes no obligation to update or revise any forward-looking
statement.
Additional Information and Where to Find It
This publication does not constitute an offer to sell or the
solicitation of an offer to buy any securities or a solicitation of
any proxy, vote or approval with respect to the proposed
transactions or otherwise, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under
the securities laws of any such jurisdiction. In connection with
the proposed transactions, McDermott [International, Inc.
(“McDermott”)] has filed a Registration Statement on Form S-4 (the
“Registration Statement”) with the U.S. Securities and Exchange
Commission (the “SEC”) that includes (1) a joint proxy statement of
McDermott and Chicago Bridge & Iron Company N.V. (“CB&I”),
which also constitutes a prospectus of McDermott and (2) an
offering prospectus of McDermott Technology, B.V. in connection
with McDermott Technology, B.V.’s offer to acquire CB&I shares.
The Registration Statement was declared effective by the SEC on
March 29, 2018. McDermott and CB&I have mailed the definitive
joint proxy statement/prospectus to stockholders of McDermott and
shareholders of CB&I. In addition, McDermott and McDermott
Technology, B.V. have filed a Tender Offer Statement on Schedule
TO-T (the “Schedule TO”) with the SEC and CB&I has filed a
Solicitation/Recommendation Statement on Schedule 14D-9 (the
“Schedule 14D-9”) with respect to the exchange offer. The
solicitation and offer to purchase shares of CB&I’s common
stock is only being made pursuant to the Schedule TO and related
offer to purchase. This material is not a substitute for the joint
proxy statement/prospectus, the Schedule TO, the Schedule 14D-9 or
the Registration Statement or for any other document that McDermott
or CB&I may file with the SEC and send to McDermott’s and/or
CB&I’s shareholders in connection with the proposed
transactions. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION OR
DECISION WITH RESPECT TO THE EXCHANGE OFFER, WE URGE INVESTORS OF
CB&I AND MCDERMOTT TO READ THE REGISTRATION STATEMENT, JOINT
PROXY STATEMENT/PROSPECTUS, SCHEDULE TO (INCLUDING THE OFFER TO
PURCHASE, RELATED LETTER OF TRANSMITTAL AND OTHER OFFER DOCUMENTS)
AND SCHEDULE 14D-9, AS EACH MAY BE AMENDED OR SUPPLEMENTED FROM
TIME TO TIME, AND OTHER RELEVANT DOCUMENTS FILED BY MCDERMOTT AND
CB&I WITH THE SEC CAREFULLY BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT MCDERMOTT, CB&I AND THE PROPOSED
TRANSACTIONS.
Investors are able to obtain free copies of the Registration
Statement, joint proxy statement/prospectus, Schedule TO and
Schedule 14D-9, as each may be amended from time to time, and other
relevant documents filed by McDermott and CB&I with the SEC at
http://www.sec.gov, the SEC’s website, or free of charge from
McDermott’s website (http://www.mcdermott.com) under the tab,
“Investors” and under the heading “Financial Information” or by
contacting McDermott’s Investor Relations Department at (281)
870-5147. These documents are also available free of charge from
CB&I’s website (http://www.cbi.com) under the tab “Investors”
and under the heading “SEC Filings” or by contacting CB&I’s
Investor Relations Department at (832) 513-1068.
Participants in Proxy Solicitation
McDermott, CB&I and their respective directors and certain
of their executive officers and employees may be deemed, under SEC
rules, to be participants in the solicitation of proxies from
McDermott’s and CB&I’s shareholders in connection with the
proposed transactions. Information regarding the officers and
directors of McDermott is included in its annual report on Form
10-K for the year ended December 31, 2017, filed with the SEC on
February 21, 2018, as amended by its annual report on Form 10-K/A
filed with the SEC on March 8, 2018. Information regarding the
officers and directors of CB&I is included in its annual report
on Form 10-K for the year ended December 31, 2017, filed with the
SEC on February 21, 2018, as amended by its annual report on Form
10-K/A filed with the SEC on March 22, 2018. Additional information
regarding the persons who may be deemed participants and their
interests is set forth in the Registration Statement and joint
proxy statement/prospectus and other materials filed with the SEC
in connection with the proposed transactions. Free copies of these
documents may be obtained as described in the paragraphs above.
McDermott Contacts
Ed MemiManager, Communications+1 (281)
870-5943ememi@mcdermott.com
FinsburyWinnie Lerner / Nicholas Leasure+1
(646) 805-2855
Investors
Ty Lawrence Vice President, Investor Relations
+1 (281) 870-5147 tplawrence@mcdermott.com
MacKenzie PartnersBob Marese / John Bryan+1
(800) 322-2885
i Permission to use quotations neither sought nor obtained.
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