French services firm Technip confirmed on Thursday that it will merge with Houston-based FMC Technologies.
The companies have entered into a memorandum of understanding (MOU) and expect to execute a definitive agreement to combine the companies in an all-stock merger transaction.
The combined company will be called TechnipFMC and would have an equity value of $13 billion based on pre-announcement share prices.
Under the terms of the MOU, Technip shareholders will receive two shares of the new company for each share of Technip.
FMC Technologies shareholders will receive one share of the new company for each share of FMC Technologies.
Each company’s shareholders will own close to 50 percent of the combined company.
The combined company will have more than 49,000 employees operating in over 45 countries.
TechnipFMC generated 2015 combined revenue of about $20 billion and combined 2015 EBITDA of $2.4 billion.
As of March 31, the two companies together had a consolidated backlog of about $20 billion.
According to the FCPA Blog, FMC received “an inquiry” from the U.S. Department of Justice earlier this month as part of a probe into whether services provided by Unaoil to its clients violated anti-bribery laws.
The inquiry was disclosed by FMC in a securities filing and follows media reports that allege that Monaco-based Unaoil paid bribes on behalf of large oil and gas firms.
“We are cooperating with the DOJ’s inquiry and are conducting our own internal investigation,” FMC said in the filing.