Sidara cuts Wood Group offer to 30 pence per share, management open to deal

Investing.com — John Wood Group (LON:WG) announced on Monday that it has reduced its potential acquisition offer of Dubai-based Sidara to 207.55 million pounds ($279.3 million). The company has indicated that it is ready to support the new terms if a formal offer is made.

Sidara, owned by Dar Al-Handasah Consultants Shair and Partners Holdings, completed due diligence on Wood over the weekend. It has reported that it is willing to buy the Scottish energy services provider for 30 pence per share.

That figure is lower compared with the offer of 35 pence per share made on April 14, which Wood previously said he would support.

Wood Group said in a statement: “The Board of Directors has considered the Downloaded Possible Offer with its financial advisors. It concluded that in the event of a formal bid intention, this value was at a level that could be recommended to Wood shareholders.”

The company also stated that Sidara and its lenders have reached a commercial agreement on the refinancing package linked to the offer. Financing was a key condition of Sidara's previous offer of £242.2m in April. This offer also included a potential capital injection of $450 million.

The UK Takeover Panel has extended the deadline for Sidara to make a definitive offer or withdraw until 28 August.

Wood has faced challenges over the past year due to contract losses and weakness in the projects division.

In February, the company's shares fell after an independent review uncovered “significant weaknesses” in its accounts. This led to adjustments to the income statement and balance sheet.

Wood Group's shares are currently suspended. But it has lost 72 percent in value so far this year.

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