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I think (ChatGPT thinks) they could get away with roughly 1.3b new shares. At 15p per share that represents around $250m raised.

Together with planned $200m of asset disposals in 2025 that makes $450m, exactly what Sid are proposing to inject. Also WG have $470m in cash, although of course they will need a lot for working capital.

Institutions with a current 150p average would get their average down to just 60p

The higher the share price before suspension the less IIs would get diluted in a rights issue.

Perhaps that’s why the sp is being kept as low as possible, to make this option look less attractive to IIs. which would indicate Sid really want the deal.

Not really binary

OR

As per RNS Wood approach IIs for a cash injection via a rights issue for example. Suspension is the perfect time to do this because Sidara walking/falling through has no effect on share price. Then WG can come out of suspension stronger, lower debt, closer to break even cash flow, lenders satisfied. Should recover strongly. We have already seen 19p, a rights issue at lets say 15p doesnt look so bad right now.

According to ChatGPT they cannot simply apply for an extension and carry on trading.

under current FCA Listing Rules, a company cannot simply apply for an extension and continue trading if it fails to publish its audited annual accounts by the required deadline (typically four months after year-end for Main Market companies).

Here’s how it works:

• Listing Rule 9.2.6R (for premium-listed companies) requires that the annual report is published no later than four months after the end of the financial year.

• FCA can and often does suspend trading automatically if this deadline is missed — even if the delay is explained or unavoidable.

• There is no formal extension process that would allow the company to delay publication and avoid suspension.

• A company might request forbearance in rare or extreme circumstances (e.g. technical difficulties, force majeure), but that would require very strong justification and is rarely granted — and even then, it’s not a public “extension” but a regulatory decision not to suspend yet.

In Wood Group’s case, their statement on 31 March 2025 essentially confirmed they expected a suspension on 30 April if they didn’t publish — which strongly suggests they were not granted, nor expecting, any special extension from the FCA.

Thanks Falcon, hope we walk away with at least 35p!

Have a good Easter weekend 👍

I could be wrong but I think it is very unlikely Sidara will lower the bid. Why?

- highly risky stategy

- lowering the bid is a dead end, if rejected you cant bid back up without seriously weakening your position/ losing credibility

- invite a currently reluctant 2nd party to enter the fray

- 35p bid is already rock bottom compared to true value. It is 10% of EBITDA

- could face permanent rejection from Institutions therefore losing the chance of acquiring this company altogether

- historically less than 10% M&A deals had the bid lowered. If these 10% only around 30% went through to completion. This reduces the chance of success to only around 3%

The outcome of Deliotte review and financial situation would have to be a lot worse than we are currently aware of for IIs to accept an even lower bid

I think it is in Sidara’s advantage for the share price to stay suppressed going into suspension.

- to soften the IIs to accept 35p or a much smaller new bid, perhaps only 40p

- to give IIs fewer options, the lower the share price is going into suspension the heavier the dilution from a rights issue making it less appealing to institutions.

Now a bit of conspiracy. If some shorts are working with Sidara, could they maintain their short to leep the sp low even going into suspension, and be compensated by Sidara in some way if they do lose on their position?

Now that makes me think the share price could remain suppressed going into suspension and may not do the usual rocket on their position last day.

Why suspension is dangerous for shorts even if sale falls through. WG could link rights issue to publication of accounts and ask FCA for an extension to suspension until rights issue is completed. Coming out of suspension share price likely to recover strongly. Shorts would scramble to close creating a mini squeeze.

2. Can the Suspension Be Extended to Buy Time?

Yes—but only if the FCA sees a clear, time-limited path to disclosure.

The FCA can allow trading to remain suspended beyond the minimum period if:

• The delay in publishing accounts is justified (e.g. forensic audits, governance issues),

• There’s evidence the company is working to resolve it,

• And there’s transparency and progress being made.

If the Sidara deal collapses, and Wood moves to quickly organise a rights issue or refinancing plan, the FCA may be willing to extend the suspension temporarily—if:

• The company communicates a credible timeline for publishing the delayed FY24 accounts, and

• The refinancing/rights issue plan is tied to that timeline (e.g. proceeds to fix governance or restate accounts).

⸻

3. Would This Give Time for a Rights Issue?

Potentially, yes. Here’s the likely sequence:

1. Sidara walks away

2. Wood confirms it will pursue a rights issue

3. The company updates lenders and the FCA

4. If the FCA sees real movement toward account publication and recapitalisation, it could allow trading to remain suspended while:

• The rights issue is negotiated with institutions

• Financials are prepared and audited

5. Once accounts are published, shares resume trading, and the rights issue is launched formally

Hopefully the delay in publishing accounts is simply due to waiting for finalisation of Deliotte review. Hopefully as straight forward as that with no more skeletons.

Although with what’s gone on over the last year you never know.

I think shots will have to close before suspension. Whatever happens will most likely play out during suspension.

- sale goes through at 35p, shorts can’t close until market re-opens at a loss

- sale falls through, institutions go for rights issue. It would be better for IIs to sort this out in suspension because the new shares will most likely be at a discount to closing share price. This would be bad for shorts because coming out of suspension with a reduced debt and lenders on board the share price is likely to recover strongly.

- only if nothing is agreed during suspension could the shorters do ok coming out the other side. I think that will be a big risk for them.

I think if institutions went for a rights issue the share price would eventually recover. ChatGPT also calculated the cash needed would increase the float to around 2b shares. When mcap gets back above £1b the share price would be over 50p so even PIs not averaging down in the dilution would eventually be better off.

Almost all analyst targets are still way above current share price and above Sidara’s offer.

Saying all that, I’d rater take 35p now lol 😂

Is it common for the first offer to be accepted by institutional shareholders in this type of takeover like Wood Group?

ChatGPT:

In situations like the Wood Group–Sidara takeover, it’s not common for institutional shareholders to accept the first offer, especially if:

1. The company has recently received a much higher offer, like Wood Group did in 2024 (230p vs now 35p).

2. The company’s value is believed to be temporarily depressed due to fixable issues (e.g. governance or short-term cash flow problems).

3. There’s a sense that the bidder is lowballing, which triggers pushback in hopes of a better deal.

⸻

Typical Institutional Behavior

Institutional investors (like BlackRock, Schroders, etc.) usually:

• Wait for a sweetened offer unless the first bid looks very fair or generous.

• Expect a competitive process (i.e. rival bids or upward movement).

• May even leak dissent through the press to put pressure on the bidder to improve terms.

• Use their voting power as leverage to extract better value.

⸻

Historical Patterns

In recent UK takeovers:

• G4S: The initial bid by GardaWorld was rejected by institutions. Allied Universal had to come in with a higher offer.

• Morrison’s: Shareholders held out for a bidding war between Clayton, Dubilier & Rice and Fortress.

In both cases, first offers were just opening shots—and final deals came in much higher.

⸻

What Makes First Offers More Likely to Be Accepted?

• If the company is in severe distress and investors fear further losses.

• If there’s no obvious competing bidder or alternative source of capital.

• If the price is already a solid premium over recent trading levels and past valuations.

⸻

Bottom Line:

No, it’s not common for institutional shareholders to accept a first offer in takeovers like this—unless the offer is very compelling or the company has no better options. In Wood Group’s case, institutions are likely to push back unless Sidara improves terms or conditions worsen further.

The board recommend the 35p offer does this mean the institutions are on board?

ChatGPT:

Great question—no, not necessarily. The board recommending Sidara’s 35p offer does not guarantee that institutional shareholders will accept it. Here’s a breakdown of how it usually plays out:

⸻

1. Board Recommendation: What It Means

• It signals that Wood Group’s directors believe the 35p offer is “fair and reasonable” given current circumstances.

• This often carries weight with shareholders, especially retail ones, but it’s not binding.

• Boards may recommend an offer if they think the company has limited options, or to avoid a worse outcome (like a refinancing or insolvency).

⸻

2. Institutions Still Hold the Power

• Major institutional investors (like Aberdeen, BlackRock, or Schroders, if they’re involved) must vote in favor of the deal.

• A recommended offer still needs 75% shareholder approval (by value of shares voted) to go through under UK takeover rules.

• Institutions might still feel 35p undervalues the company, especially those that bought in during better times or expect long-term recovery.

⸻

3. When Board Support Isn’t Enough

• We’ve seen cases where boards recommended low bids and shareholders blocked them. One example: G4S’s board backed GardaWorld’s offer in 2020, but investors held out for Allied Universal’s higher bid.

⸻

4. What to Watch

• If large shareholders go public with their opposition to the deal, Sidara might be forced to raise the offer.

• Sidara could also offer additional incentives, like cash injections or governance reforms, to win support.

⸻

Bottom Line:

The board’s support is important, but not the final word. Institutional shareholders can still block the deal—and if enough of them think 35p is too low, Sidara may need to sweeten the offer.

ChatGPT when asked who said the offer of 35p is too low?

For instance, Danni Hewson, head of financial analysis at AJ Bell, remarked that Sidara’s offer might be perceived as undervaluing Wood Group’s potential, suggesting that the company “will have to dig deeper if it’s going to win over a board that understands the fundamental value of the business and realises what’s on the table is still insultingly low”

"Question: If big investors think 35 pence is too low and the long term holders want more as 35 pence unde values the company, then why not buy at 20-22 pence?"

Or it could be that institutions are preparing for a rights issue, knowing that they will pick up the new shares at a much lower price than 20p?

Probably unlikely, but could be interpreted that way

Thank Jehanson much appreciated!

"Question: If big investors think 35 pence is too low and the long term holders want more as 35 pence unde values the company, then why not buy at 20-22 pence?"

Because institutions already hold over 90% between them.

Its a bit like musical chairs, some big holders would need to sell for others to buy a lot more.

They could of course try to grab them off the single digit % of PI holders. And who knows that's exactly what may be happening?

I have to say I am unsure if IIs are on board or not.

It would make sense they were consulted.

Does anyone know how Sidara’s other successful purchases went?

Were there several rounds of bids or the first bid accepted and that’s it?

Could someone paste the article text here please, its behind a paywall. Thanks

Captain I hoped so too. I think it will be sold too.

Obviously RR is a even more prestigious company so not a complete like-for-like comparison, but it did have its share price suppressed down to 65 all the way into the autumn of 2022 when it finally started to rise.