RE: Todays FT article 1st March1 Mar 2025 14:39
“This is a crisis that went slowly, slowly, slowly then suddenly, and that’s because the board has been much too hesitant to admit that things were unravelling,” the veteran said.
In less than two years, the company has failed to reach agreement on a takeover offer from private equity group Apollo that would have valued it at about £2.2bn and another from Dubai-based rival Sidara that would have valued it at £1.6bn. Sidara this week returned for its second buyout attempt at what is now expected to be a significantly lower price.
The veteran said Wood had ignored “multiple escape chutes on the way down”, particularly the takeover approaches.
“Now shareholders are going to presumably get a much worse deal,” he said. “Shareholders have a right to be angry.”
According to people close to the original discussions with Sidara last year, there was a perception that the Wood board scarcely believed a UK institution might be sold to a Middle Eastern rival.
That was a “failure to read the room”, one adviser said.
“There was a sense that these guys weren’t truly serious about a sale — that despite having completed due diligence that this was only the start of a discussion, rather than a precursor to hammering out the final details,” another adviser said.
The deal was “not existential” for Sidara, the person added.
“When they felt they weren’t being treated with enough respect, it made it easier to walk away,” the person said.
Wood Group’s problems also reflect wider challenges for its home region.
Melfort Campbell, an entrepreneur and veteran of the North Sea oil industry, described Wood as “hugely emblematic” of Aberdeen, saying its “core home business” in the North Sea had “dried up”.
Higher energy taxes have undermined investor appetite, fuelling fears of a brain drain among Aberdeen’s executive and corporate base, as the debate rages over new drilling for fossil fuels.
Reflecting widespread local anger at successive governments’ handling of the sector, Campbell said: “It’s been cut off at the knees for political expediency.”
Scotland’s highest civil court, the Court of Session, in January ruled that two of the few offshore UK oil and gas developments still being considered had been granted their consents incorrectly because their downstream emissions were not considered. The UK government will now have to reconsider whether they can go ahead.
With roughly 4,500 of its 35,000 global work force based in Aberdeen, Wood accounts for about one in 10 of north-east Scotland’s oil and gas jobs.
From the moribund housing market to empty stores on Aberdeen’s once-grand Union Street, residents feel that the city has, unlike in previous economic cycles, not benefited from the revival of the oil price since the 2014 crash.
Sir Ian, now 82, can still sometimes be seen driving around the “Granite City” in an Aston Martin sports car. He is working
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