NEW YORK – Robotti & Company Advisors, LLC, a significant shareholder in McDermott International, Ltd., has publicly challenged the structure and pricing of McDermott’s pending refinancing and rights offering. In a letter initially shared with McDermott’s board of directors on July 7, 2026, and subsequently made public on July 9, 2026, Robotti & Company asserted that the offering massively undervalues the offshore energy and marine-construction business and is designed to disproportionately benefit a select group of insiders.
Criticism of Offering Structure and Valuation
Robotti & Company, which manages approximately $1.2 billion and beneficially owns about 2% of McDermott’s Class A Ordinary Shares, expressed serious concerns regarding the $1.50 per share price set for the rights offering. The firm contends that this valuation is unsupported by McDermott’s recent performance and represents an “enormous discount to the fundamental value of the Company.”
The core of Robotti’s criticism centers on the offering’s structure, which it argues “structurally disadvantaged McDermott shareholders to the benefit of a small group of privileged insiders who are acting as backstop parties.” According to Robotti, two of these four backstop investors have representatives on McDermott’s Board, leading to a transaction that would “redistribute existing equity value disproportionately to a small group of shareholders we understand to be a control group.” This arrangement, Robotti claims, concentrates ownership among these privileged insiders while diluting other shareholders.
Call for Equal Shareholder Participation
To rectify what it perceives as an inequitable structure, Robotti & Company has called on McDermott’s board to amend the terms of the rights offering. The proposed solution is to include an “oversubscription privilege” for all participating shareholders. This mechanism, Robotti argues, would permit “fair and equal participation in the Company’s continued success” and allow all participants to “share equally in the value of the Rights Offering and support the Company’s future.”
Robotti emphasized its role as a “long-term and involved shareholder, not a passive or opportunistic holder,” stating its belief in taking an active role when shareholders face “serious dilution and financial harm.”
McDermott’s Business Recovery Undervalued
Robotti’s conviction regarding McDermott’s undervaluation is rooted in the company’s own reported financial performance, which Robotti highlights as demonstrating a “marked and sustained upswing.” The investor cited several key metrics from McDermott’s audited financial statements and refinancing materials:
- Revenue: Approximately $10 billion for the trailing-twelve months ended March 31, 2026, an increase from $8.2 billion in 2024.
- EBITDA: Roughly $489 million for the same period.
- Balance Sheet: A net-cash position, indicating cash in excess of outstanding debt.
- Backlog: A remaining performance obligation of approximately $17.6 billion as of March 31, 2026, which McDermott itself has described as both substantial and improving in margin.
- Market Conditions: A more consolidated and rational competitive landscape, coupled with a strengthening Middle East reconstruction and construction outlook, where McDermott is positioned as one of a small number of dominant participants across onshore and offshore work.
Based on these figures, Robotti & Company expressed the view that McDermott’s business has “turned a corner” and is a “recovered and growing business” that can and will succeed. The firm argues that all shareholders participating in the rights offering should be able to purchase a pro rata portion of any unexercised rights, rather than seeing that value concentrated among a privileged few.
As McDermott navigates its refinancing efforts, Robotti & Company’s public stance introduces a significant point of contention regarding shareholder equity and corporate governance. The call for an oversubscription privilege aims to ensure that the benefits of the company’s demonstrated recovery are accessible to all investors, not just a select group.
