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TechnipFMC (FTI) Announces Divestment of Technip Energies Shares

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·3 min read
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TechnipFMC Plc FTI announced the divestment of 25 million Technip Energies shares through a private placement in the form of an accelerated bookbuild offering. Notably, this represents about 14% of the share capital of Technip Energies, which started trading under the symbol TE on the Euronext Paris Exchange early this year.

In February, TechnipFMC completed the spin-off of its engineering and construction activities into a separate entity, Technip Energies, and transformed itself into a technology-focused equipment provider for the energy industry. Importantly, TechnipFMC shareholders own about 50% of the outstanding Technip Energies shares on a pro-rata basis.

The stock price in the placement has been fixed at €11.10 per share, thereby, offering total gross proceeds of €277.5 million. At the same time, Technip Energies will buy 1.8 million shares from TechnipFMC at €11.10 per share in accordance with the placement price. Notably, the purchase is separate from the placement.

Following the completion of the transaction, TechnipFMC will retain a direct stake of 31% of Technip Energies’ share capital. The company agreed to a 60-day lock-up for its remaining shares in Technip Energies based on certain customary exceptions, which involve the transfer of shares to a subsidiary, granting and enforcement of security interests regarding financing, and derivative transactions and tender into any public tender offer for all or part of the shares.

The placement was carried out for eligible institutional investors and without a public offering in any country. Notably, settlement for the placement will likely occur on or around Apr 30.

Company Profile & Price Performance

TechnipFMC is a leading manufacturer and supplier of products, services and fully-integrated technology solutions for the energy industry. It operates through two business segments — Subsea Technologies and Surface Technologies.

Shares of the company have outperformed the industry in the past six months. Its stock has gained 43% compared with the industry’s 40.3% growth.

Zacks Rank & Stocks to Consider

TechnipFMC currently carries a Zack Rank #3 (Hold).

Some better-ranked players in the energy space are Sasol Ltd. SSL and Exxon Mobil Corporation XOM, each currently sporting a Zacks Rank #1 (Strong Buy), and Ecopetrol S.A. EC, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Sasol’s earnings for 2021 are expected to surge 81.5% year over year.

Exxon’s earnings for 2021 are anticipated to increase 18.2% year over year.

Ecopetrol’s earnings for 2021 are expected to rise 24.6% year over year.

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