Member Info for Kando

"If the board is sitting on unaudited numbers so bad they can’t be published"

"It’s going to say, “Why the hell are we being asked to vote with no numbers?” Think about it 🤔"

So to be clear, you now also think the board of Wood can and should release unaudited accounts to the market?

You think disclosure requirements don't apply to Wood? You think the potential liabilities to Wood and its would-be owners wouldn't be significant having released unaudited numbers in order to guide the outcome of a takeover? The legalities of guiding the market with what may turn out to be unreliable numbers would probably sink any takeover regardless in subsequent litigation.

You sound now like you don't even understand the market you trade in.

"if the board can’t release the accounts before pushing a deal"

There you go again making it clear you have no idea what an audit is or who the audit is done by.

The BoD of Wood =/= KPMG.

Really try to internalize that. It'll help with your struggles. KPMG decide when to sign off the accounts, not Wood.

"I’m saying don’t push a deal before they’re published."

You keep presuming they have a choice.

"The idea that it’s pointless to debate me because I won’t just roll over?"

It's pointtless to debate you because you have no idea what you're talking about.

You act like the board are choosing to withhold the accounts from you. You clearly have no idea what an auditor is, does, or how they operate.

It's pretty simple:

-Capital structure has been announced as weak.

-Waivers announced and extended for debt covenants breached.

-Additional lending likely restricted.

-Cash situation therefore likely acute (since for the second year running they're selling assets to cover cash shortfall; you don't do that if you have a comfortable amount of capital).

-Completion of audit for 3 prior years may yet be far off; auditing $5b+ in yearly revenue streams takes time(...) - this is especially the part you don't seem to get, at all.

-Cash situation may dictate a sale/liquidity injection/recapitalization before accounts are signed off by the auditors.

-Failure to resolve the capital structure issues to their satisfaction and timetable may see lenders force WG's hand with another form of recapitalization - bad for shareholders.

We'd all love to see the accounts, but in investing you don't always get what you want. I'd rather avoid a highly dilutive rights issue or debt for equity arrangement. Because that's what is at stake here, as communicated by the company. Someone is offering to recapitalize the business, avoid all that, and buy out holders at a premium to the latest market price. The company's eagerness to secure this deal suggests that's still the only Win available here. Everything else is likely a big fat L.

That's why no-one will debate you anymore Icecool. You and your "I would rather see Would burn, than let Sid buy it for a bargain price of 35p." alter ego. Your ranting and raving sounds desperate and means nothing.

I worry that there might be something not quite right with you Ice, so we'll leave it there. I'm not convinced you debate people here in good faith.

Excuse the very obvious pun, but Ice, you can't seem to see the Wood for the trees.

"No profit warning RNS."

Other than the one on February 14th?

https://www.proactiveinvestors.co.uk/companies/news/1066276/wood-group-plunges-31-after-sounding-the-earnings-alarm-1066276.html

"No guidance change RNS."

Other than the one on February 14th signalling the forecasted positive free cash flow for 2025 would be negative 150-200m and they'd have to sell assets to fill the cash gap?

"No covenant breach RNS"

Then why did they get waivers? Why did they expect to breach debt covenants as a consequence of the Review findings? Why did they then EXTEND those waivers AFTER they knew the extent of the findings? They clearly broke their covenants.

"No going concern red flag RNS"

Their last going concern statements both factored in a significant remaining cushion to draw from the Revolving Credit Facility. It's not fantasy to assume that lenders might have restricted their drawing any further from the RCF given the historic breaches and future uncertainty. Afterall, in the financial press there were rumours those same lenders were trying to sell some of their Wood Group debt at a discount, just to get out. So through that lens, you'd imagine they'd be balking at allowing Wood to draw more borrowing from them.

"Winning billion dollar contracts ✅."

When you make ~5.6bn a year in revenue, you have to replace, on average $1.4bn every quarter, every 3 months, just to maintain that revenue. It's not unusual to keep signing new business. It tells you nothing of current cash flow, nor even whether the order book is growing or shrinking overall. They could sign $1bn in contracts, and be down $400m on treading water.

"And actually logically think about the situation."

We all rather wish you would. The constant spamming of your alternative reality just gums up this board with nonsense and emoji ridden copium.

We're all holders. We all want a good outcome. But your outcomes are based on rage and fantasy. Just tone it down a bit, please.

@SUFCESSEX

No one can say for sure, but per the sky article earlier this month, insiders are "confident" of securing "a deal" by the end of this month. The proposed offer, which the board is minded to accept, is 35p, so one can only assume that is still the deal they are working towards. This offer, according to the board and outside financial advisors represents the best outcome for holders against every other form of available recapitalization (which has been made clear is required).

The implication by extending only until the end of the month and the expiry of the waivers from lenders, is that either sufficient conditions are about to met to formalize the bid, or... lenders have balked at extending the waivers any further, want their Wood liabilities resolved, and are forcing both Sidara and Wood to get on with it, to literally "put up or shut up" now or never.

So on or before the 30th, I can only surmise we'll see a formalized bid, and the board minding to accept. That then triggers the first tranche of Sidara liquidity injection, staving off near term disaster, the debt modifications are simultaneously secured, and shareholders await a vote on whether to accept the offer and number of weeks/months later.

In that time between the bid/the recommendation and the vote, is when, if there is any other interest, one would expect hands to be shown and hats to be thrown into the ring. If the company are being honest, and there are other bidders interested, then they already know the 35p assumed price and are still engaged, so one would hope they'd still have a willingness to outpay that price if they're still engaged.

"Kando

Totally agree with your post.

My concern at the moment is the 30th June Deadline Sidara set themselves.

As they knew WG couldn’t deliver the accounts by that deadline, why set it?

It’s a puzzle assuming they still want to buy WG and wish to see the accounts first?

It’s a riddle.

Ideas?"

I too, have been pondering about this. I really don't know. It surprised me as well.

I can only guess that lenders are exerting pressure to hurry it along, and have been willing to accept the debt modifications on the back of seeing the accounts (in their incompletely audited state). Sidara then get the debt modifications they're after, and they too, are willing to take the unaudited view of accounts as acceptable to proceed.

I mean, if capital structure is so weak, weaker than we can know, and/or lenders are limiting drawdown from the RCF because of the covenant breaches, then the cash situation might be fairly acute, maybe less than a year, or months worth of runway (that's just speculation, but given the mood music wouldn't be surprising anymore). We don't really know even ballpark how long it'll take for the audit to complete, it's multiple years and they'll want to be rigorous given the reputational damage from misleading audits prior. So it could be audited accounts are still 3, 6, even, who knows, 12 months away. So too long for everyone involved. It's even possibly the auditors are suggesting they won't sign off on the going concern statement without the Sidara liquidity injection first. So it might all just be reordering itself into the only sequence that works for everyone.

But honestly I don't know.

"Kando.

I take in board some of what you are saying, but if we are still winning business ( Billions)

Then surely once the results are finalised this BoD should promote Wood as a decent investment and put the "For sale" sign up."

They did put the for sale sign up Jolly. They leaked via the FT in Feb they were looking to sell the business whole.

Regarding the contracts, I think people forget that for a company of ~5.6bn revenue a year, you need to sign about $1.4bn of contracts on average, every single quarter, so every 3 months, to maintain or replace that revenue into the future. Contract wins are great, but there's no real indication yet of anything other than the regular churn. We don't even know if the order book is increasing or decreasing, they just sound good in isolation and absolutely what you'd publicize in a crisis to mitigate the gloom.

"I would rather see Would burn up, than sell it to Sid for 35p"

Says it all. Sums up just how toxic and moronic some of the posters here are.

"It needs to scrape off the onshore barnacles come into dry dock for a refurb then go about its profitable business extracting the black gold."

It's a glib analogy but this is the refurb, this board is the clean up crew. The company finances were on a SIGNIFICANTLY worse trajectory prior to Gilmartin.

The Deloitte review was not optional, it was as you say, scraping off the barnacles of previous mismanagement. And it would have been pressed upon them by increasingly wary lenders.

If you want to sack what remains of the board, none of whom but Franklin had anything to do with Amec Foster Wheeler acquisition, legacy lump sum turnkey projects or appointed divisional heads, one of which it now transpires, contrived to hide their losses.

This talk of sacking the board is beyond tedious now. Beside the lack of justification, it'd be corporate suicide and destroy what remains of any shareholder value. Sacking the board mid-takeover/bailout and mid crucial debt renegotiations would essentially cement the company as an irredeemable basket case. If Sidara walks, it's bad news. If the board are sacked, it's bad news. There's a path to redemption for Wood, but some of you would rather not take it.

Let us hope it augurs well.

/inb4 162p final offer after a bidding war.

It's a shame this humbling result and collapse of his narrative hasn't dented Ice's enthusiasm one jot.

Still as deluded and obnoxious as ever.

Hopefully this board will now be allowed to move on from Icecool's inane rantings of fantasy AGM insurrections and alternative "facts" [EMOJI EMOJI EMOJI].

But I doubt it.

Instead he'll pin his embittered hopes on all those institutions and holders who voted through all the resolutions today abruptly changing their mind at some indeterminate later point and ousting the whole board in righteous fury to appease his blood lust. And this board will no doubt keep hearing about it 24/7.

Yes Ice. Everything you say challenges my narrative. It challenges most people's narratives. It challengers the company's and its lenders narratives too.

Well done with that.

Honestly Ice, I didn't bother to read that wall of text because I know it's more of the same.

Just don't be surprised when the whole board are reelected next week on 98-99% yes votes and you'll have wasted all this time baying for their blood.

You can't stop the deal, you can't sack the board, institutions will be backing this, all we can do is hope that there is a bid, and for other bidders to improve the offer. Baseline, everyone should be hoping to avoid a RI/D4E, which you don't seem to be. More fool you.

I don't work for Sidara Dazpink, but I hope they or someone bigger soon own my shares. If Wood still own my shares out the other side of this, the arithmatic of the situation tells me they will be worth a whole lot less. Yours too.

"When WG come out of suspension the share price could in first few hours of trading move back up to 35p just on the YE results alone, markets react quickly to positive news and we don’t know yet what is to be revealed, do you not agree Kando ?"

Truthfully, no. AS much as that would be wonderful, I don't anticipate it will shoot to or above Sidara's offer upon leaving suspension. There's a reason the board seem eager to get a deal over the line by the end of the month. These restated accounts have been bad news and by the sounds of it the company wants to secure the deal before the release of the audited accounts and leaving suspension. That should tell you much about the acuteness of the situation behind closed doors. If lenders are forcing the issue they don't have much choice. They're in a net debt position and what available liquidity they have is in the RCF, if they've had their ability to draw from that removed because of the covenant breaches, then they will be needed to recapitalize pronto - hence the staggered injections from Sidara which imply a sense of urgency, and just have much over a barrel Sidara feel that they have Wood.

Medjed, the numbers have been run here before. Raising 450m at the current mcap of 127m implies of level of dilution that would require the subsequent mcap of the company to be above 1.8bn to reach the current 35p per share proposed offer. So from 127m mcap to 1.8bn mcap is roughly 15x, just to get back to the 35p per share currently proposed. You'd have to wait a long long time, if ever, to get a positive return on choosing dilution over the proposed offer.

I get it, you're all angry. Don't shoot the messengers. It's just math, don't take it personally.

While that's very witty and all, most of this forum actually wants to make money on this share. The Sidara bid puts a floor in how low this can go - the alternative recapitalization options, RI/D4E send the share price much lower, so much lower that the company would likely have to 15x afterwards just to break even on the current 35p offer.

Sidara's offer baits out any other serious parties before it's too late and Wood is taken off the market. The scenario everyone should be hoping for is a competing bid, not for our only bid to fall through, takeover and debt negotiations to collapse because dingos like you sacked the board negotiating them.

Too many of you are just blinded by greed.