Scana Acquires BOP Stacking

Scana Industrier ASA has agreed to acquire the Houston, Texas based engineering company BOP Stacking Inc. The acquisition brings Scana closer to the oil service clients in the largest service market within the oil and gas industry. At the same time Scana and FPSOcean have decided to cancel the announced acquisition of FES Ltd.

BOP Stacking Inc. (`BOPSI`) is a leading provider of engineering, procurement and construction services (EPC contracts) as well as project management related to delivery of new or modified blow-out preventer (`BOP`) stacks. The company supplies stacks to several of the globally leading drilling contractors, with whom the company also holds frame agreements as pre-approved vendors. As a response to client requests, BOPSI has recently also established a presence in Singapore for serving the important new-build and retro-fit market in South-East Asia.

The company was established two years ago and is expected to reach revenues between mNOK 70 and 80 in 2008, with good profitability. Scana will pay mNOK 35 for 70% of the company, with an option to acquire the remaining 30%. Closing of the acquisition is expected to take place during May, as Scana has already performed a due diligence of the company.

CEO of Scana, Rolf Roverud, comments, "Scana has for several years had a good and close co-operation with BOP Stacking and its management team, and this is a team we trust and have high expectations to. We are happy that the founders of the company will continue their effort as a part of the Scana group. BOP Stacking will provide Scana with an operative base in the important oil service market in the Gulf of Mexico, and will serve as a platform for further growth in this market. The acquisition will also allow Scana ut extend the cooperation with existing key customers. Furthermore Scana will be able to explore synergies with respect to supplying components. BOP Stacking and Scana Offshore Technology, who serves the North Sea market, will be able to develop a complete service concept for its common customers within the drilling segment on international basis."

At the same time Scana and FPSOcean have decided to cancel the announced acquisition of FES Ltd, which Scana published on April 7. The due diligence has revealed that the targeted synergies related to technology and markets will be more difficult to realize, and that an acquisition as such has too small development potential. Scana and FPSOcean will, however, continue the co-operation for further development of the jointly owned turret/swivel technology for the FPSO market.