Wood Group shares soar following £242m Sidara bid
Wood Group shares soared more than 13 per cent on Monday after the announcement of a £242m takeover bid from the UAE’s Sidara.
The stock clawed back significant ground in early trading after a torrid start to the year that has seen it drop nearly 60 per cent amid concerns over Wood Group’s governance and corporate culture.
The fresh 35p per share offer from Sidara is significantly less than a £1.5bn proposal it walked away from last year.
A Deloitte review in February found “material weaknesses and failures” across Wood’s business and it has delayed publishing its financial results for 2024 after information was witheld from auditors.
Sidara said it has made significant progress in its due diligence on Wood, including in relation to the points raised in the review, according to a statement on the London Stock Exchange.
Its offer includes a possible £341m capital injection into Wood.
“Work continues on a range of alternative refinancing options to provide the company with an appropriate and sustainable long-term capital structure,” it reads.
The companies believe combining Wood and Sidara would create a “leading global engineering consulting company,” bringing together Wood’s domain experience with Sidara’s strengths in the energy and materials markets.
Sidara blamed “rising geopolitical risks and financial market uncertainty” last year as it pulled out of the bid process for Wood, becoming the second bidder to pull out after rival Apollo walked away in 2023.
Wood said on Monday its board would be “minded to recommend” Sidara’s latest offer as it seeks an “appropriate long-term capital structure” for the benefit of shareholders.
However, a firm offer is still contingent on certain pre-conditions, including the publication of its audited full-year results.
Founded in 1956, Sidara operates as an engineering consultancy in 69 countries. Wood Group operates in around 60 countries and employs 35,000 people globally.