Vallourec closes on acquisition of Tianda Oil Pipe

BOULOGNE-BILLANCOURT, France -- Vallourec has announced that it has closed on the acquisition of a majority stake (50.61%) in the Chinese company, Anhui Tianda Oil Pipe Company Limited (TOP) and thereby increased its total stake to 70.07%. This process coincides with the commencement of a mandatory unconditional cash bid for the remaining minority interest in TOP, which will close on Dec. 2, 2016, unless Vallourec revises or extends the bid in accordance with the Hong Kong Code on Takeovers and Mergers. The two transactions value TOP's share (50.61% + 29.93%) at approximately $175 million.

TOP is a Chinese manufacturer of seamless tubes listed on the Hong Kong Stock Exchange. TOP's industrial assets include, in particular, a PQF rolling mill with 500 kt capacity, as well as a tube heat treatment and threading workshop. The company has 1,500 employees.

This acquisition, announced on Feb. 1, 2016, is part of the Vallourec 2015-2020 Transformation Plan. It will enable Vallourec to create a new and very competitive production hub in China to supply the domestic market and export, particularly in Asia and the Middle East. It will allow Vallourec to develop a wider range of solutions that combine VAM connections with Tianda's very competitive tubes to support the market share of VAM connections.

Vallourec has been present in China for more than 20 years. At the end of 2016, Vallourec will have 2,000 employees (including TOP) in China on five production sites that serve both the oil and gas market and the power generation market. In 2015, China represented almost 7% of the Group's total revenue.