Petrofac stakeholders see "very positive" path for CB&I deal as vote looms

Dubai: Petrofac expects creditor approval for the sale of its Asset Solutions business to CB&I, with the Company Voluntary Arrangement tied to the transaction applying only to a limited group of creditors and leaving employees and trade partners unaffected, according to sources familiar with the matter.

Sources, who asked to be anonymous as the matter is still private, said all stakeholders recognise the combination with CB&I as a positive outcome for the business and that operations at Asset Solutions are continuing normally during the CVA process. The arrangement does not impact trade creditors, employees and several other parties.

Following completion of the sale, CB&I is expected to operate the acquired business through two global divisions. CB&I Asset Solutions will be based in Aberdeen, Scotland, while CB&I Storage Solutions will continue to operate from Texas. Each unit will retain independent accountability within the CB&I structure.

Sources added that the acquisition strengthens CB&I’s portfolio by expanding its integrated services capabilities, supporting its international growth strategy and delivering predictable cash flow through the reimbursable contracting model.

Petrofac earlier announced that a meeting of Petrofac Facilities Management Limited’s creditors will take place at 10:00 on January 30 2026, to vote on the proposed CVA required for completion of the Asset Solutions sale.

“The agreed sale of Asset Solutions to CB&I is a strong outcome for the business and for around 3,000 colleagues who are expected to move across on completion," said John Pearson, Chief Operating Officer for Petrofac’s Asset Solutions business. "After more than two years of restructuring, this CVA is the final step to deliver that outcome, and we are asking creditors to support it so the sale can complete.”

Petrofac confirmed in December that it had entered into an agreement to sell the Asset Solutions division to CB&I.

Administrators at Teneo also described the transaction as a positive outcome for the future of the unit and its workforce.

Alongside the Asset Solutions sale, Petrofac continues to advance alternative restructuring and M&A solutions for Petrofac Emirates, its UAE-based engineering and construction division.

Sources said this process is progressing in line with expectations. Petrofac Emirates remains fully operational and continues delivering projects in the UAE and international markets during this period.

Petrofac Emirates is recognised as a long-standing engineering and construction business with strong technical capability and a significant presence in the regional energy and infrastructure sector.

Petrofac was once among the most valuable energy services companies operating in the Middle East, with a market value topping £6 billion and a position in the FTSE 100. The group built a significant regional footprint, securing major engineering and construction contracts across Iraq, Saudi Arabia and the UAE.

That trajectory shifted after corruption investigations revealed that senior executives had used third-party agents to bribe officials to win business. The UK’s Serious Fraud Office launched a formal investigation in 2017.

Former Petrofac executive David Lufkin later pleaded guilty to 14 bribery charges. In 2021, the company admitted seven counts of failing to prevent bribery and agreed to pay penalties exceeding £77 million.

The convictions severely restricted Petrofac’s access to state-backed contracts, cutting off key sources of revenue. At the same time, the company was carrying roughly $4 billion in debt.

A proposed restructuring aimed at converting more than $800 million of debt into equity was overturned by the Court of Appeal in July 2025, leaving Petrofac financially exposed.

The loss of the TenneT contract in October proved to be the tipping point for the company’s position and outlook.

The outcome of the January 30 creditor vote will mark the final stage of the Asset Solutions sale and is expected to shape Petrofac’s broader restructuring path across key markets.