The European Commission has opened an in-depth investigation into the proposed EUR 21 billion merger between Saipem and Subsea 7, citing concerns about competition in the market for subsea engineering and construction services.
The Phase II review, announced on 22 July, follows the companies’ notification of the transaction on 16 June. The merger was first unveiled in February 2025.
The Commission is examining the supply of SURF services, covering subsea umbilicals, risers and flowlines. These systems connect offshore wells with production facilities and are also used in carbon capture and storage projects.
Its preliminary review found that Saipem and Subsea 7 are two of the world’s three leading SURF suppliers and compete directly for complex offshore projects. The combined company would hold high market and capacity shares, while only one comparable competitor would remain alongside smaller suppliers with more limited capabilities.
The Commission said the proposed transaction could reduce competition, with possible effects on prices and innovation. It also identified limited spare capacity and high entry barriers linked to the capital required for specialised offshore vessels.
Large oil and gas companies may have limited ability to resist price increases when there are not enough credible alternative suppliers, according to the preliminary findings.
The investigation will also consider potential competition issues in trunkline services for large export pipelines and in the decommissioning of subsea infrastructure.
Regulatory reviews have produced different outcomes in other jurisdictions. Brazil’s competition authority, CADE, approved the transaction without conditions in June. That decision has faced legal challenges from Exxon Mobil, Petrobras and TechnipFMC. The Australian Competition and Consumer Commission has also opened an in-depth investigation.
The merged business is expected to operate under the name Saipem7. It would have annual revenue of approximately EUR 21 billion and a combined order backlog of around EUR 43 billion.
The European Commission has set 26 November as the deadline for its final decision. The companies could propose measures such as reducing capacity or selling vessels, but no remedies have been offered.
Saipem primarily serves national oil companies including Saudi Aramco, QatarEnergy and ADNOC, while Subsea 7 works more closely with international companies including BP and Equinor.
