TechnipFMC To Complete Spinoff of Technip Energies February 16, Leave S&P 500

Catnip? No, TechnipFMC(FTI), we had never heard of the $5B market cap S&P 500 component. Or it will be in the S&P 500 until Friday, February 12, when it is removed in favor of Monolithic Power Systems(MPWR). TechnipFMC, which was formed several years ago by the merger of Technip and FMC,

is a global leader in the energy industry; delivering projects, products, technologies and services. With our proprietary technologies and production systems, integrated expertise, and comprehensive solutions, we are transforming our customers’ project economics.

Organized in three business segments — Subsea, Surface Technologies and Technip Energies — we are uniquely positioned to deliver greater efficiency across project lifecycles from concept to project delivery and beyond. Through innovative technologies and improved efficiencies, our offering unlocks new possibilities for our customers in developing their energy resources and in their positioning to meet the energy transition challenge.

Each of our approximately 36,000 employees is driven by a steady commitment to clients and a culture of project execution, purposeful innovation, challenging industry conventions, and rethinking how the best results are achieved.

The company had previously announced plans for a spinoff, but put them on hold in March as the pandemic wreaked havoc on markets.  With markets back on track, the spinoff is back on and scheduled for next week. TechnipFMC will spin off Techinp Energies to shareholders.  February 16 has been set as the distribution date. Shareholders will receive one share of Technip Energies for every five shares of TechnipFMC held.  No fractional shares will be distributed. Technip Energies shares are expected to trade over the counter as an ADR.

Honestly, we don’t know too much about these companies. It appears this largely an undoing of the 2017 merger and the Technip Energies business will be most of the old Technip, focusing on oil and gas. This is an under the radar company in an out of favor sector, being removed from the S&P 500 and it will be trading OTC. This all suggests that the Technip Energies spinoff will decline post-spin amid forced selling, and may soon represent an attractive value.  We’d love to hear your thoughts. What do you think about the potential for TechnipFMC and Technip Energies?

Disclosure: The author holds no position in any stock mentioned.