Wood Group’s Dubai-based suitor cuts takeover bid by £30m

Troubled Wood Group revealed its Dubai-based suitor Sidara has cut its takeover proposal to £207.6m, but said it would be prepared to accept the reduced price.

The Aberdeen-headquartered engineering and energy services firm said Sidara had confirmed on Saturday it was “committed to making an offer”, but that any formal bid would be at the lower price of 30p a share.

Sidara – a privately held network of engineering and design companies run from the United Arab Emirates – had previously made an approach worth 35p a share in mid-April, valuing Wood Group at £242.2m.

The deadline for Sidara to make a firm offer or walk away has now been extended to 5pm on Thursday, August 28, Wood Group added.

Wood Group said: “The board has evaluated the reduced possible offer with its financial advisers and concluded that it is at a value that the board would be minded to recommend to Wood shareholders.”

The firm said it had now agreed a “commercial alignment” on the terms of a proposed refinancing, which was a condition to the takeover proposal first announced in April.

It said it was also continuing to work with its auditor on significantly delayed accounts for 2004.

Wood Group shares, which are currently suspended, had plunged by more than 70% amid a torrid time for the firm.

The troubled Scottish group, which provides oilfield and engineering services, warned in April that it was having to restate its accounts from previous years.

It also delayed the publication of results for the 2024 financial year, which were due at the end of April, meaning its shares have been suspended from trading on the London Stock Exchange since.

This followed an independent review carried out by Deloitte finding “material weaknesses and failures in the group’s financial culture” within its projects business unit and the engagement with its group finance team.

The Financial Conduct Authority launched an investigation into Wood Group in June after the independent review unearthed the “cultural failings” with its accounting practices.

Sidara’s takeover interest comes a year after talks around a previous £1.56bn takeover approach from the Dubai bidder collapsed.

However, Wood Group’s share value has tumbled in the months since, particularly after recent updates highlighted potential governance failings and the need for Wood to restate its accounts.