Wood plc, the Aberdeen-based company integral to the region’s oil and gas sector, is set to be acquired by Sidara, a Dubai-based engineering and design firm. This decision follows a significant drop in Wood’s market value, which has raised concerns about its stability.
A shareholder vote resulted in 88% approval for the takeover after delays linked to difficulties in finalizing financial accounts with auditors. The accounts, published on October 30, reported a pre-tax loss exceeding £2 billion, with outstanding issues identified by auditors regarding the company’s historical financials.
The board of directors recommended acceptance of Sidara’s offer, indicating that other refinancing options might yield even lower returns or potentially no value for shareholders. At its peak in 2013, Wood had a market valuation surpassing £5 billion and employed over 50,000 individuals globally.
Formally known as the John Wood Group, the company is expected to resume this branding under Sidara. Sir Ian Wood, who previously led the firm and has been involved in philanthropic efforts, retired as chairman 13 years ago. In 2017, Wood acquired AMEC Foster Wheeler, inheriting substantial debt and associated legal challenges.
Attempts by Wood to diversify into services related to refineries, urban design, and renewable energy were met with contractual difficulties. Sidara had proposed a £1.6 billion bid last year but withdrew amid market uncertainties, before returning this year with a much-reduced offer of £216 million. Sidara has pledged to invest $450 million (£342 million) into Wood.
Despite its financial challenges, Wood has maintained a strong reputation in engineering, securing various contracts. Following the acquisition, Ken Gilmartin, the CEO since 2022, plans to step down and will be succeeded by CFO Iain Torrens. Additionally, Roy Franklin, the current chairman, has announced his intention to resign as well.
Source: https://www.bbc.com/news/articles/c620p344331o?at_medium=RSS&at_campaign=rss