Amec Foster Wheeler to be sold in £2.2bn deal
Cheshire-based engineering giant Amec Foster Wheeler is being acquired by multinational energy services company Wood Group in a deal worth more than £2.2bn.
The combination will result in Amec Foster Wheeler shareholders owning about 44% of the share capital of the combined group.
Aberdeen-headquartered Wood Group said the combined group will achieve cost synergies of at least £110m a year.
Four members of the Amec Foster Wheeler Board will join the board of the enlarged company upon completion as non-executive directors, with Roy Franklin joining as deputy chairman and senior independent director.
Robin Watson and David Kemp, currently chief executive and chief finance officer of Wood Group, will continue in their roles for the combined group. Ian Marchant will continue as chairman.
Marchant said: “The combination represents a transformational transaction for Wood Group, which accelerates our strategy and creates a global leader in project, engineering and technical services delivery across a range of industrial sectors.
“It extends the scale and scope of our services, deepens our existing customer relationships, facilitates further development of our technology-enabled solutions and broadens our end market, geographic and customer exposure.
“The combination will create an asset-light, largely reimbursable business of greater scale and enhanced capability, diversified across the oil & gas, chemicals, renewables, environment and infrastructure and mining segments.”
John Connolly, chairman of Amec Foster Wheeler, said: “Since the arrival of Jonathan Lewis as CEO, the executive management team of Amec Foster Wheeler has made significant progress towards the transformation of the business.
“This has been achieved through cost reduction initiatives, the disposal of non-core assets and a reorganisation of the business. The Amec Foster Wheeler board have fully supported the revised strategy and the preparations to deliver the appropriate balance sheet to support the standalone prospects of Amec Foster Wheeler.
“However, the Amec Foster Wheeler board believes that a combination with Wood Group adds to the standalone prospects of Amec Foster Wheeler, by accelerating the delivery of the future value inherent in the Amec Foster Wheeler business and, at the same time, helps to realise the full potential of each of Amec Foster Wheeler and Wood Group.”
The sale of the company’s £274m turnover nuclear businesses, including Clean Energy which employs more than 1,200 people in the North West, is still going ahead separately to the Wood Group deal and is expected to complete in the third quarter.
