The European Commission has announced the launch of an investigation on the proposed agreed merger by the Italian Saipem and the Luxembourg Subsea7, a project that will result in the establishment of Saipem7 and which Brussels fears may have a significant impact on competition in some Offshore engineering and construction services markets ( of 24 February and 25 July 2025).

The Commission stated that it had found that it had Preliminary that the merger is largely complementary in some sectors, including offshore wind projects and conventional offshore companies, while it seems that it would consolidate further into the market for services in the systems market umbilical, riser and flowline (SURF) submarines that connect the offshore wells, often located thousands of meters below the level above-surface production facilities, and which are also used in the capture and storage of carbon. The Commission noted that the global market for SURF services is already highly concentrated and that, Saipem and Subsea7 being two of the three market leaders together with the TechnipFMC, there are very few credible alternatives and therefore the merger could significantly reduce the significant competition.

Brussels also noted that other possible competitors appear to be considerably smaller and limited in their ability to compete across the board and whereas spare capacity is limited and obstacles entry and expansion in this high-intensity sector capital are very high, which is partly explained by the significant investments related to highly sophisticated ships that are necessary, especially for more complex projects. The Commission considers that, despite the fact that customers of these services are in many cases sophisticated and large operators, mainly active in the oil and gas sector, is may not be able to withstand the increases in prices in the absence of sufficient credible alternative suppliers.

The Commission will also assess whether the transaction can be generate critical issues in terms of competition in other closely related markets, such as markets for services for trunklines, which involve the laying of more and for the dismantling of subsea infrastructure which seem to require ships and capabilities similar to those required for installation.

The Commission now has 90 working days, until next November 26, to adopt a decision.