KCA Deutag - comment

KCA reported Q3 numbers yesterday and away from the actual historics, KCA provided an update on both Russia and the integration of the Saipem acquisition. KCAD have exited the Russian business as of 21st July, with a total impairment of $245m. To put into context, Russia contributed c.23% of KCA’s group EBITDA. Separately, KCA is integrating its Saipem Onshore acquisition, with the 1st and largest phase (Saudi, UAE and African segments) of the acquisition completing at the end of October. The rest of the acquisition is likely to complete during H1 2023.

Pro-forma for the acquisition, leverage has increased to 2.0x, excluding the $200m of PIK financing and the additional equity contribution of $25m. We intend to reformulate our model for the acquisition and the new financings in the coming days.