A merger of McDermott International and CB&I, the majority partner in the contractor building a plutonium-conversion plant for the Department of Energy, is expected to close May 10 after shareholders for both companies approved the combination.
That is according to a joint press release Wednesday from the companies. McDermott shareholders would end up owning 53 percent shares in the combined company, which will carry the McDermott name.
The companies announced the proposed takeover in December, and secured U.S. antitrust approval in January. The combined company would be led by McDermott President and CEO David Dickson and have a combined annual revenue of about $10 billion, with a roughly $14.5-billion backlog.
The combined company will use the McDermott name and meld CB&I’s energy-technology and infrastructure businesses with the current McDermott’s engineering and offshore-oil-infrastructure operations.
CB&I had 26,400 employees worldwide in 2017, according to the company’s latest 10-K filing with the U.S. Securities and Exchange Commission. McDermott had about 11,800 employees in 2017, according to its most recent 10-K.
The acquisition brings a little bit of nuclear business back into McDermott’s portfolio nearly a decade after the company spun off what is now the nuclear-technology and government services business known as BWX Technologies.
CB&I is the lead partner on CB&I AREVA MOX Services, the prime contractor on the Mixed Oxide Fuel Fabrication Facility (MFFF) under construction at the Department of Energy’s Savannah River Site in Aiken, S.C. The plant, which the National Nuclear Security Administration (NNSA) wants to cancel, is designed to turn 34 metric tons of weapon-usable plutonium into commercial reactor fuel as part of an arms-control pact with Russia finalized in 2010.
In 2016, the year the MFFF was supposed to come online, MOX Services sued the NNSA in the U.S. Court of Federal Claims, alleging the agency’s bad-faith mismanagement of the contract put the facility more than 10 years behind schedule and at least $5 billion over budget. The NNSA claims MOX Services failed to deliver what the agency paid for under the contract awarded in 1999 to a predecessor company.
