Latest news with #ArvindBalan
The Herald Scotland
23-04-2025
- Business
- The Herald Scotland
Iraq contract boost for Wood as bidder considers options
The wins come as the jobs of thousands of Wood staff working in Aberdeen and offshore in the North Sea may be at risk. Wood employs 4,500 people in Aberdeen and the North Sea operations it runs mainly from the city. The group is in talks about a potential takeover by a bidder based in the United Arab Emirates. The Scottish firm's bargaining power appears to have been reduced following a series of dramatic developments in recent weeks. READ MORE: SNP Government 'laser-focused on delivery' claim rings hollow Wood announced plans for hefty cost cuts in February, which were expected to result in job losses, as directors prepared to slash the valuation of its assets. The company made the move as it waited for the results of an independent review into contracts at its troubled projects division, which helps oil and gas firms develop new fields around the world. Chief executive Ken Gilmartin insisted at the time that moves to 'right size' the group would leave Wood well placed for growth in attractive markets. Days later the company faced embarrassment after it told investors that chief financial officer Arvind Balan had stood down following the 'incorrect description of his professional qualifications in various statements in the public domain'. In late March the group published the results of the review of the projects division, which highlighted a range of failings. Wood noted 'inappropriate management pressure and override to maintain previously reported positions' and instances of unreliable information being provided to the group's auditors. Publication of Wood's annual results for 2024 has been delayed, from April 30. READ MORE: North Sea giant plans $500m investor payouts amid slump fears However, last week Dubai-based Sidara tabled a non-binding takeover proposal at 35p per share which valued Wood at around £240 million. Wood directors said that after considering alternatives they would be minded to recommend a formal offer from Sidara on those terms citing the interests of shareholders, creditors and other stakeholders. Coming months after Sidara decided to walk away from a £1.5bn bid to buy Wood, the latest approach may look opportunistic. However, with Sidara also proposing to inject $450m (£335m) into the Wood business, the company appears to see significant potential in its target's operations. After focusing on supporting oil and gas for decades, Wood has expanded into a range of low carbon energy markets in recent years. It remains unclear if Sidara will proceed on the terms outlined. On April 17 Wood announced that the deadline for Sidara to confirm it planned to make a firm offer for the group or walk away had been extended to May 15. READ MORE: North Sea jobs cull looms after blockbuster oil and gas deals Employees may be anxious about the prospect of Sidara acquiring the group. Sidara may look to combine Wood with its other engineering operations or find other ways to squeeze costs out of the business. The loss of another stock-market listed firm would be a blow for Scotland's corporate sector. A series of Scottish engineering firms have been acquired by bidders based outside the country in recent years. Glasgow-based power specialist Aggreko was bought by private equity investors in 2021, for £2.1bn. Some Wood shareholders may see the proposed deal as the best way of securing value for their holdings. Shares in Wood have plunged from 211.4p in August last year to around 20p. The company faced pressure from dissident investors who were unhappy about its share price performance before the recent decline. If Sidara does not proceed another bidder may decide to step in. However, Wood has effectively been in play for months. US investment giant Apollo made repeated takeover approaches in 2023 culminating in one that valued Wood at £1.7bn. It decided to walk away in May that year. Wood chief executive Ken Gilmartin (Image: Wood) Mr Gilmartin's confidence in Wood's operations will be put to the test if the group is left to soldier on as an independent. Wood has won two contracts with TotalEnergies worth $11m in total to help debottleneck and upgrade existing facilities on the Ratawi gas field. The group has hired 70 Iraqis to work at its Ratawi operations hub to support work on the contracts. Wood has been working on Ratawi since 2023. It said it currently employs over 4,000 people across the Middle East, having increased headcount in the region by 500 in 2024.
The Independent
31-03-2025
- Business
- The Independent
Wood Group warns over need to restate accounts after ‘weaknesses' uncovered
Wood Group shares have tumbled once again as the firm said it was set to suspend shares after warning it would restate accounts following 'cultural failings' uncovered in a review. The troubled engineering and oilfield services firm said it was expecting to make 'material' adjustments to previous financial statements and its balance sheet for the past three financial years. This means its results for 2024 – which had been due to be published on April 30 – will be delayed, which will see its shares suspended as a result. Shares in the FTSE 250 group plunged by more than 30% on Monday, with the group having lost nearly 80% of its stock market value in the past year. It stressed it remains in talks over a potential takeover by Sidara – a privately-held network of engineering and design companies run from the United Arab Emirates – with its suitor given until April 17 to make an offer or walk away. Aberdeen-based Wood Group said the draft results of an independent review by Deloitte found 'material weaknesses and failures in the group's financial culture' within its projects business unit and engagement between the division and its group finance team. It added: 'This included inappropriate management pressure and override to maintain previously reported positions, including through unsupported dispensations, and over-optimism and/or lack of evidence in respect of accounting judgments. 'The cultural failings appear to have led to instances of information being inappropriately withheld from, and unreliable information being provided to, Wood's auditors.' The firm stressed there has since been significant change within the group and steps taken to address the failings discovered. Russ Mould, investment director at AJ Bell, said: 'The deadline for Sidara to formalise a takeover deal has been pushed to April 17 but whether the latest revelations cause a rethink for the Dubai-based group or complications in the timetable remains to be seen. 'While the issues revealed in a draft review of the business mainly relate to historical performance at its projects business unit and do not relate to cashflow, they raise questions of culture given the failure to maintain robust accounting standards.' Sidara abandoned an initial takeover tilt last August, blaming global market turmoil and geopolitical risks, having put forward four takeover proposals – the last valuing Wood Group at around £1.56 billion. It is understood to have made the fresh approach due to Wood's recent heavy share price falls. Sidara's decision to abandon a deal last summer sent Wood Group's shares plunging, dealing a blow to investors who have suffered a languishing share price and a number of failed takeover attempts for the company. In another unfortunate twist, Wood Group's chief financial officer Arvind Balan resigned in February after admitting making an inaccurate claim about a chartered accountant qualification.
The Guardian
31-03-2025
- Business
- The Guardian
UK oil firm admits ‘cultural failings' after it withheld figures from auditors
The UK oil services company John Wood Group has admitted that its financial results need to be restated, after a review found 'cultural failings' led to information being withheld from its auditors. The FTSE 250-listed company said the independent review, carried out by Deloitte, also found 'inappropriate management pressure' to stick with existing financial reports. Shares in the company – which is in takeover talks with a Dubai-based suitor – plummeted by 31% on the news, and are down by 84% over the past five years. The Aberdeen-based engineering and consultancy company, which employs 35,000 people, said Deloitte had found 'material weaknesses and failures in the group's financial culture' within the projects division, and engagement between the unit and group finance. This means that financial results will have to be restated for 2022, 2023 and 2024, and profits are likely to be lower than previously reported. The Deloitte review identified issues in a number of contracts in the projects division, particularly in relation to 'legacy lump sum turnkey projects' – projects where a contractor handles everything from design and planning to construction and handover. It also unearthed problems with the application of accounting standards, such as holding amounts on the balance sheet that should have been written off. 'This included inappropriate management pressure and override to maintain previously reported positions, including through unsupported dispensations, and over-optimism and/or lack of evidence in respect of accounting judgments,' the company said. 'The cultural failings appear to have led to instances of information being inappropriately withheld from, and unreliable information being provided to, Wood's auditors.' The group was audited by KPMG. It added that were 'no material issues' in Wood's other businesses – consulting, operations and investment services. Wood said it had taken action, including changes in important roles in finance, and was committed to strengthening its financial culture, governance and controls. It is likely that, due to the 'extensive work' needed to complete the audit, it will not publish its 2024 accounts by 30 April, which would lead to its shares being suspended from trading. Wood remains in talks with its lenders over refinancing options. Last week, Wood's chief financial officer, Arvind Balan, quit abruptly after it emerged that he had misstated his professional qualifications, and was replaced on an interim basis by Iain Torrens, who previously served as CFO at TalkTalk and the financial services firm Icap. The company is still in discussions with Dubai-based Sidara, a group of specialist engineering and design companies, whose deadline to make a firm offer or walk away has been extended until 17 April. Sidara has made a number of attempts to buy the company, and last week offered 230p a share, valuing Wood at £1.58bn. Amid much to-ing and fro-ing, Sidara pulled out of a bid last August, citing 'rising geopolitical risks and financial market uncertainty'. Sidara, which was founded in Beirut, Lebanon, in 1956 as Dar al-Handasah, provides engineering and consultancy services on large building projects. Nearly two years ago, Wood rejected a series of bids from the US fund manager Apollo Global Management, whose final proposal offered 240p a share, or £1.7bn.
The Independent
24-03-2025
- Business
- The Independent
Wood Group extends takeover talks with UAE suitor Sidara
Troubled engineering firm John Wood Group has given its Dubai-based suitor Sidara more time to come up with a firm offer. Aberdeen-headquartered Wood Group said Sidara – a privately held network of engineering and design companies run from the United Arab Emirates – now has until April 17 to make an offer or walk away under City takeover rules. The previous so-called 'put up or shut up' deadline had been set for after market close on Monday. It follows Wood Group's confirmation last month that Sidara had returned for a second takeover tilt less than a year after walking away from a deal. Sidara abandoned a deal last August, blaming global market turmoil and geopolitical risks, having put forward four takeover proposals – the last valuing Wood Group at around £1.56 billion. It is understood to have made the fresh approach due to Wood's recent heavy share price falls. Shares in Wood Group, which have been given a small boost on news of takeover interest, lifted 5% in Monday morning trading on hopes a deal remains on the cards. Sidara's decision to abandon a deal last summer sent Wood Group's shares plunging, dealing a blow to investors who have suffered a languishing share price and a number of failed takeover attempts for the company. FTSE 250-listed Wood Group, which provides oilfield and engineering services, saw its shares tumble 80% over the past year, giving it a stock market value of just over £200 million before the latest bid interest – significantly lower than the £1.6 billion approach made by Sidara last year. Its stock market woes have been compounded by concerns over the financial and governance culture within its project arm following a recent independent review, as well as heavy debts. In another unfortunate twist, Wood Group's chief financial officer Arvind Balan resigned in February after admitting making an inaccurate claim about a chartered accountant qualification. Wood Group is waiting for the results of the review by Deloitte, as well as the sign-off of its 2024 accounts. Bid interest from Sidara comes after a failed private equity attempt to take over Wood Group in 2023. Apollo made an approach worth £1.68 billion, or 240p per share, to buy Wood Group after four previous approaches were rejected, but eventually abandoned plans to make a firm offer. Wood Group provides consultation, management and engineering services for the oil and mining sector, with operations in more than 60 countries. However, it has focused more heavily on its sustainable business recently, helping companies with decarbonisation and the energy transition.
Telegraph
24-02-2025
- Business
- Telegraph
North Sea oil giant revives takeover talks with Dubai-based suitor
A Dubai-based engineering group has re-entered talks to buy John Wood Group, sparking a 40pc surge in the North Sea oil giant's share price. The FTSE 250 business confirmed on Monday it had received a fresh approach from Sidara, just six months after previous talks collapsed. At the time, Sidara said the prospective takeover was off 'in light of rising geopolitical risks and financial market uncertainty'. However, it has been brought back to the table owing to Wood Group's low valuation, the Financial Times reported, with the company's share price having fallen by 75pc over the past 12 months. The company, which offers outsourcing services to major North Sea producers, is now valued at around £235m, a fraction of the £5bn it was worth in 2017. Under stock market rules, Sidara is obliged to announce a firm intention to make an offer by March 24. It follows a tumultuous period for the business, which has received a combined nine offers from Sidara and private equity firm Apollo in recent years. Wood Group's shares previously took a hit in November after announcing Deloitte had been drafted in to conduct an independent review of its accounts. Bosses said this month that the review had shown it needed to improve its culture and controls in the light of 'identified weaknesses and failures', while Deloitte's findings also suggested profits from Wood Group's projects division may have been overstated in 2023 and prior years. Wood Group also confirmed last week that its chief financial officer had resigned after admitting he incorrectly claimed to be a chartered accountant. Arvind Balan, who joined last April, said: 'Regrettably, I made an honest oversight with respect to the description of my professional qualification as a chartered accountant instead of a certified practicing accountant.' Sidara is part of Dar Al-Handasah Consultants, which was founded in 1956 in Beirut. The group, which turned over $2.8bn (£2.2bn) in 2023, is privately owned by 44 partners working in the business.
