Private equity firm Apollo Global has given an extra month to make an offer on John Wood Group
- Apollo now has until April 19 to announce its “firm intention” to make an offer
- Wood Group’s board has rejected four Apollo takeover bids to date
- Bids for Wood come amid series of acquisitions of London-listed businesses
Apollo Global Management has four more weeks to submit a proposal to acquire the John Wood Group engineering services business.
The private equity giant had until Wednesday next week to declare its “firm intention” to make an offer, but was granted an extension until April 19.
Wood’s board has to date rejected four unsolicited takeover bids for Apollo because it believes they significantly undervalue the company, which has a current market capitalization of just under $1. £.5 billion.
Deadline: Apollo Global Management has an additional four weeks to submit a proposed takeover of engineering services firm John Wood Group.
Last month the Scottish firm revealed it had received three separate offers from Apollo, the highest being worth 230p per share, before announcing it had been offered a deal of 237p per share a fortnight later.
Shares of Wood Group were up 3% at 209p on Friday morning.
Wood’s approach is part of a series of acquisitions of London-listed companies by overseas private equity firms taking advantage of the weaker pound and relatively low valuations.
UK stalwarts that have fallen victim to overseas takeovers in recent years include sub-contractor G4S, Ultra Electronics and supermarket chain Morrisons, which Clayton, Dubilier & Rice bought for £7billion in October 2021.
On Wednesday, event planner Hyve Group agreed to a £481million takeover of US firm Providence Equity Partners after rejecting two previous bids.
Providence’s accepted offer of 108p per share is more than 80% lower than Hyve’s January 2020 share price.
Shares of the exhibition organizer have fallen during the Covid-19 pandemic due to lockdowns and cross-border travel restrictions that have caused conferences to be canceled or postponed.
Hyve suffered a further blow when it pulled out of Russia, where it employed more than 200 people, after the start of war in Ukraine 13 months ago.
Shares of Wood Group have also failed to recover to pre-Covid levels, after being hit by the massive drop in oil prices in 2020 and the delayed commissioning of new projects.
This is despite the company returning to profitability in the first half of last year amid soaring oil prices and the $1.8 billion sale of its built environment division to WSP Global. , one of the largest professional services companies in the world.
At the end of December, the company had a book record of $6 billion, after winning renewed contracts with oil supermajors BP and Shell, as well as a four-year contract with INEOS to build a petrochemical complex in Belgium.
Based in Aberdeen and with operations in approximately 60 countries, Wood Group has traditionally provided engineering and consultancy services to the oil and gas sector, but has increasingly expanded into the renewable energy sector.
On Tuesday, it completed the sale of its offshore labor supply business in the Gulf of Mexico to Danos, a Louisiana-based energy services contractor.
Chief Executive Ken Gilmartin said “The divestment signals the proactive steps we are taking to selectively enhance the group’s portfolio and invest in the markets and solutions where we see the strongest profitable growth.”
