Aker to buy majority stake in Brazil's CSE

Aker Solutions entered into an agreement to buy 70% of Brazilian CSE Mecânica e Instrumentação Ltda, in which the deal comes with an option to purchase the remaining 30% of the company three years after the expected close of the transaction by the end of Q1 2017.

Image of a CSE worker, from Aker Solutions.

The acquisition gives Aker Solutions access to Brazil's growing market for servicing existing oil and gas fields. CSE, which had revenue of about US$102 million (BRL 322 million) in 2015, provides maintenance, assembly, commissioning and crane operation services at offshore and onshore facilities.

The parties agreed to not disclose the purchase price.

"Aker Solutions has established a solid presence and reputation in Brazil's oil and gas market over the past 40 years and entry into the country's brownfield segment is an attractive growth opportunity," said CEO Luis Araujo. "Joining forces with a successful local player like CSE fits well with the internationalization of our services business, allowing us to bring our competence, knowledge and experience within this field to this important and growing region."

CSE whose headquarter is in Pinhais in the Parana state, has 2300 employees located at sites including five service facilities covering the country's different oil and gas basins. It has a strong backlog of $271 million (BRL 855) million and a track record of delivering consistently high-quality services to customers including state producer Petrobras. The company's fabrication shop in Rio das Ostras is located near Aker Solutions' subsea services facility.

To ensure continuity, the owners of CSE CEO Altair Dietrich, and Chief Commercial Officer Luiz Joanello, will stay on with the company. CSE will remain a separate legal entity with a management team consisting of personnel from each company.

"By combining the strengths of both companies we will expand our capabilities and create significant value for our customers," said Dietrich. "Teaming up with Aker Solutions is a huge step for the company and puts us in the next league in terms of competing for even larger and more complex contracts."

The acquisition is subject to approval by Brazilian competition authorities.