ACCC Orders Phase 2 Review of Saipem-Subsea7 Merger

The Australian Competition and Consumer Commission (ACCC) has mandated a Phase 2 review of the proposed merger between Italy's Saipem and Norway's Subsea7, citing potential competitive concerns in the supply of subsea umbilicals, risers, and flowlines (SURF) services in Australia. The ACCC stated that the merger "could substantially lessen competition" and requires an in-depth assessment. Submissions are open until July 21, with the Phase 2 review potentially taking up to 90 business days and subject to extension.

Key Areas of Investigation

The ACCC will investigate several aspects, including the extent to which removing a key provider would affect competition in Australian SURF services, whether remaining suppliers could constrain the new entity in tenders, and if Australian offshore operators could bypass the merged entity through self-supply or sponsoring new entry or expansion. Saipem has been involved in major Australian projects like Woodside's Scarborough development and Inpex's Ichthys LNG project, while Subsea7 won a contract from Chevron for the Gorgon Stage 3 project in December.

Regulatory and Industry Context

ACCC Commissioner Philip Williams noted that the acquisition could substantially lessen competition in critical subsea infrastructure services for Australian offshore oil and gas projects. The merger, announced in July last year, would create a combined entity called Saipem7 with operations in over 60 countries and a €43 billion order backlog, owned equally by both sets of shareholders. The merger was previously expected to close in the second half of 2026, with shareholder approval already obtained.

Previous Approvals and Opposition

The merger has received approvals from the UK's Competition and Markets Authority (CMA) in November 2025 and Brazil's Administrative Council for Economic Defense (Cade) last month. However, oil companies Petrobras and ExxonMobil, along with offshore services provider TechnipFMC, have petitioned against the merger. Upstream has sought comment from Saipem and Subsea7 regarding the ACCC's further review.