Google AI13 Nov 2025 13:23
Support from institutional shareholders for Sidara's takeover of Wood Group appears likely. The Wood Group's board has unanimously recommended the offer, warning that alternatives could result in shareholders receiving "materially less, and potentially zero, value" for their shares. The institutions are expected to follow this recommendation.
Reasons for the likely institutional support:
Board recommendation: The Wood Group's board has clearly and unanimously recommended the takeover.
Financial instability: The company has been facing severe financial issues, including significant debt, ongoing negative free cash flow, and accounting problems that led to the suspension of its shares from the stock market earlier in 2025.
Best available option: The board has presented the Sidara deal, which includes a critical $450 million capital injection, as the best option to secure the company's financial stability.
No strong public opposition: While there has been online chatter, particularly on smaller investor forums, suggesting dissatisfaction, there has been no significant, organized public opposition from major institutional shareholders.
Exit strategy: Some institutional investors, such as Blackrock, have already reduced their stake in Wood Group, suggesting a move to exit rather than fight the takeover.
Risk of "zero" value: The board's strong warning that a "no" vote could result in a total wipeout for shareholders further incentivizes institutions to accept the offer.