FMC Tech Acquires 45% Stake In Schilling Robotics For $116 Million

December 26, 2008 10:28 a.m. EST

Houston, TX (AHN) - In a bid to tap into a new market segment at a subsea level, FMC Technologies, Inc. (NYSE:FTI) has decided to acquire 45 percent of Schilling Robotics LLC for $116 Million in a transaction expected to close no later than Dec. 31.

The oil drilling equipment manufacturer said Friday that its acquisition is likely to be accretive to the company's earnings per share in fiscal 2009 in a move to expand its business in subsea energy exploration.

FMC Technologies also manufactures and supplies subsea production systems, but its market participation is lower than the other companies in the sector.

"This is a unique and exciting opportunity to expand our subsea business in a new direction," FMC Technologies Chairman, President and CEO Peter D. Kinnear said in a statement on Friday.

"Additionally, the relationship will allow FMC to participate more fully in the increasing integration of remote activities performed on the seabed such as subsea processing, well intervention and production optimization," he added.

Davis, Calif.-based Schilling Robotics is a maker of control systems, remotely operated vehicles and other equipment and services to explore and drill for oil and gas beneath the ocean floor.

"Our partnership with FMC is a logical outcome of the growth trajectory we have been on for many years," Schilling Robotics Chairman Tyler Schilling said in commenting on the strategic implications for his company.

He continued, "FMC understands and endorses our strategy to introduce innovative digital technologies in response to the growing communications and control challenges facing our customers in the subsea environment. In the last few years we have undertaken numerous initiatives that expand our participation in this major market."

Additionally, FMC Technologies has entered into a definitive agreement with Schilling to acquire the rights to exercise an option, over the two-year period beginning in 2012, to acquire the remaining 55 percent of the company.

Shares of the company were rising by 17 cents or 0.77 percent to $22.23 in composite trading on the New York Stock Exchange on Friday, after hitting a high of $22.45 just after the bell.

The stock of the firm has traded as low as $20.27 and as high as $83.18 in the last 52-week period, with an average volume of 2.34 millons.