Luxembourg-based Tenaris, a leading supplier of tubes and related services, has closed its previously-announced acquisition from a private group of 47.79 per cent of the shares of Saudi Steel Pipe Company (SSP).

SSP is a welded steel producer listed on the Saudi stock market, for a total amount of SR529.8 million (approximately $141 million).

SSP’s facilities are located in the Eastern Province of Saudi Arabia and have a manufacturing capacity of 360,000 tonnes per year. The company, which started its operations in 1980 and serves energy, industrial and commercial segments, is qualified to supply products with major national oil companies in the region, including Saudi Aramco.

Tenaris will begin consolidating SSP’s results from January 21, and together will have more than 1,000 employees in Saudi Arabia.

Tenaris has been serving the Saudi market for decades, and the combined portfolios coupled with the strengthened technical capabilities will allow the company to better meet customers’ requirements.

The result of the transaction is expected to expand Tenaris’s industrial presence in Saudi Arabia, one of the largest markets for OCTG (oil country tubular goods) and line pipe products, and the range of products it supplies to Saudi Aramco.

Since its first industrial investment in Saudi Arabia in 2010, Tenaris has continuously invested in the expansion of its local operations, supporting the industrialization of the country.

“The official integration of Saudi Steel Pipe into Tenaris marks an important step to further expand the company’s footprint and capabilities in Saudi Arabia,” said Mariano Armengol, who has been appointed as managing director and chief executive officer for SSP.

“I would like to recognise the efforts of both Tenaris and SSP teams who contributed to the successful closing of this acquisition. We are very positive to what the future holds in terms of business growth and people development,” Armengol added.

Ahmed Al Debasi, SSP’s former managing director and newly appointed chairman of the board of directors, said: “We are pleased to join Tenaris, a global leader who shares our industrial legacy, our commitment to customers and our willingness to contribute to Saudi Arabia’s oil and gas development.”

“The integration will strengthen our technical capabilities, allowing us to better meet customer requirements and become an industrial hub for the region,” he added.

SSP operates five pipe production lines, covering an outside diameter range from ½-inch to 20-inch outside diameter which complements Tenaris’s existing offering in Saudi Arabia.
 
Tenaris’ premium OCTG threading facility in Dammam covers a range from 4 ½ inches to 14 inches for the threading of full length pipes and accessories, with an annual capacity to produce 120,000 tonnes.

The combined portfolio will provide Saudi Aramco and regional customers with a comprehensive range of products, which includes welded pipes, commercial pipes and a full range of line pipes, as well as expanded services offer incorporating coating and bending, it stated. – TradeArabia News Service