Britain’s struggling oilfield services and engineering firm Wood Group has received a fresh approach from Dubai-based Sidara about a possible takeover offer after a failed attempt six months ago, both parties said on Monday.
Shares in the London-listed company surged as much as 52% to 40 pence apiece in Monday’s trade.
Sidara, which abandoned its previous plans, has made a fresh approach following the collapse of Wood Group’s shares in recent weeks, the Financial Times first reported, citing two people close to the discussions.
Shares of Wood Group have lost more than 60% of their value since the start of the year through Friday’s last close, and more than 85% since Sidara walked away from the previous discussions, citing rising geopolitical risks and uncertainty in the financial market.
Wood Group forecast negative cash flow for another year and saw its CFO step down earlier in the month following a tumultuous past few years of activist investor pressure to consider a sale, two unsuccessful takeover proposals and a review of its financials.
Sidara was keen to move quickly to ensure it could retain senior and mid-ranking Wood staff who have been angered by the company’s plight and its decision to cut bonuses, the FT report added, citing people with knowledge of the talks.
The financial terms of the potential offer were not disclosed by Wood or Sidara in their Monday statements.
(Reporting by Yamini Kalia, Radhika Anilkumar and Prerna Bedi in Bengaluru; Editing by Vijay Kishore, Tasim Zahid and Alan Barona)
