Jean-Georges Malcor, head of CGG, defends its strategy, despite the collapse of 29% of the course.
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Technip closed Sunday evening the folder CGG . The group had tried to convince the beginning of November specialist seismic oil with a proposed takeover bid to 8.30 euros per share, including the boss of Technip , Pilenko , again Monday defended the strategic interest. Jean-Georges Malcor , CEO of CGG, says Le Figaro the reasons for its refusal, on market turbulence bottom. The stock has lost 29.3% Monday , while Technip gained 1%.
Le Figaro. - Why CGG she refused Technip's redemption proposal?
Jean-Georges Malcor. - We rejected the proposal to Technip for reasons primarily industrial. CGG is a geosciences company whose entire strategy in four years is based on three pillars, our three business lines, such as equipment, data acquisition, including through our fleet of seismic vessels, and imaging and interpretation. This triptych became our DNA. Customers validate this model. Or, Technip has made clear that he wanted the separation of data acquisition business. It was a project which challenged the integrated model of CGG obviously unacceptable.
Since November 10, when the proposal was put on the table, Technip he has not changed on that?
Not. Therefore, no compromise could be found. Technip is committed to us in an unsolicited approach. CGG, it must be remembered, is not for sale. But we discussed this episode with an open mind. Our refusal is not dogmatic. CGG has demonstrated in the past its reactivity and pragmatism. But the board and I have considered that this project does not create value for our group.
Technip believes that your data acquisition activities outside complement its own and create a range of interesting services. This will he just seems?
I agree Pilenko when he explains that seismic activities are key. For our customers, knowledge of hydrocarbon reservoirs is strategic. The interest of Technip our sole GRR division validates the Group's strategy for four years! But I consider for my part, like Schlumberger, this also involves mastering the art of acquisition. One could consider other forms of commercial cooperation between our two groups like the alliances or joint ventures that we have with others and work very well.
Technip said he has social consequences of your project?
Not. Never. But we were convinced that the cost synergies promised by Technip could be achieved without consequences on employment. 400 to 500 jobs threatened us appeared in France in the acquisition division.
The method of Technip and her boss she shocked you?
Pilenko and I, we know each other very well. I think the use wished we led discussions upstream rather than receive a pre-offer. That said, the episode is closed and the debates that we had remained very professional.
The creation of a French champion does she tries not you?
I am not unsympathetic to the argument. Technip and CGG already are, each in its field, world leaders. But such a project can not be conceived by amputating one of two groups of one of his legs.
CGG is it alone in a position to face a depressed market by the oil price collapse?
The transformation plan that we consider unfold over three years has been accelerated and has been completed in fourteen months. CGG has with Sercel and GGR two divisions resilient cycle trough. CGG has reduced its fleet, lowered costs and was put in a position to face a very difficult market . The context pushes customers to cut their exploration budgets, but they do not reduce to zero as long seismic expenses, which will be the first segment to leave.
Some investors doubt that you can escape a capital increase. And the share price fell sharply on Monday ...
They already felt at the end of the first quarter and then the second, third ... They were wrong and we maintain that we come out of this cycle of low on our own. We renegotiated our debt maturities. We will continue our debt reduction efforts as appropriate by asset disposals. As in, the reaction seems mechanics. It does not surprise us.