Aberdeen-headquartered engineering firm Wood (LON:WG) has extended a deadline for Dubai-based competitor Sidara to make a firm takeover offer to the end of July.
Sidara had until 5pm today to confirm its ‘final offer‘ for Wood at 23op per share, but the Wood board and the independent Takeover Panel agreed to an extension until 31 July.
Wood decided to grant Sidara access to due diligence materials in June as it mulled the final offer, which valued the firm at around £1.6bn.
Under UK takeover rules known as “put up or shut up” (PUSU), bidders need to announce a fully financed binding offer within 28 days, or confirm it will not be making an offer in which event it is subject to a 6-month standstill.
However, Wood can continue to extend the deadline with the agreement of the Takeover Panel and Sidara.
Wood first rejected a takeover bid from Sidara in May, priced at 205p per share, and later rejected two subsequent offers at 212p and 220p per share.
Wood Group takeover
Since May, Wood’s shares have risen by around 40% in response to the prospect of a Sidara takeover.
It comes as Wood announced a cost cutting drive earlier this year following a “mixed” financial performance in 2023.
Speaking to Energy Voice earlier this year, Wood chief executive officer Ken Gilmartin said the company is prioritising a “return to positive cash flow”.
© Supplied by WoodBut speculation regarding a potential sale for the FTSE-250 company has persisted since talks with American firm Apollo broke down on a separate takeover bid last year.
Apollo offered 24op per Wood share in May last year, before the US private equity group decided to walk away from its bid.
Sidara takeover
Granting the original deadline extension last month, Wood said it “remains confident in Wood’s strategic direction and its fundamental prospects”.
“However, having now weighed all relevant factors including, in particular, feedback received from Wood shareholders, the board has decided to engage with Sidara to determine if a firm offer can be made on the same financial terms as the final proposal,” Wood said.
© DC ThomsonFounded in 1982 by Aberdeen businessman Sir Ian Wood, Wood Group employs around 35,000 people across major energy hubs including Houston, Calgary, Perth, Abu Dhabi and Milan.
Who is Sidara?
Formerly known as Dar Group, the company rebranded to Sidara in December 2023 to coincide with the COP28 conference in Dubai.
Jordanian businessman Kamal Al-Shair founded the company as Dar Al-Handasah in Lebanon in 1956 alongside three engineering colleagues at the American University of Beirut.
The firm gradually expanded operations in the Middle East and North Africa in the 60s and 70s, and made its first acquisition of US firm Perkins & Will in 1986.
Sidara expanded in to the UK with the acquisition of Penspen in London in 1990.
According to its website, Sidara now operates in 60 countries with close to 20,500 employees across 308 offices and 21 group companies.
The firm posted $2.8bn in revenues in 2023, and is privately owned with around 44 shareholders.
In the UK, Sidara is working on projects including the EET Hydrogen Hub near Liverpool and the Humber low carbon industrial cluster project.
Internationally, Sidara is also working on major projects including the New Administrative Capital in Egypt and expansions to airports in Jeddah, Saudi Arabia, and Shanghai, China.
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