Wood Group and Amec merger completes

Engineering group Worley Parsons will launch a $322m capital raising to fund UK oil acquisition

WorleyParsons will issue almost 25 million shares as part of the offer, and hopes to utilise its strengths as a market leader in the maintenance, modifications and operations (MMO) space to bring new opportunities to the UK Continental Shelf.

To fund its British acquisition, the Australian company will issue new shares as part of a $322 million capital raising (through a one-for-10 entitlement offer and existing debt facilities).

The Aberdeen-based company said it did not anticipate any job losses in the north east of Scotland as a result of the deal.

"Wood is better placed to serve customers than ever before, with a more comprehensive range of capabilities and the potential to deliver efficient integrated solutions with fewer customer interfaces", Watson added.

It is understood that, while there will be some rationalisation at the outset, the 3,000-plus people on payroll are thought to be secure.

Amec is now in the process of being taken over by multinational energy company, the John Wood Group, for $3.7 billion.

WorleyParsons expects the AFW deal will be complete by the end of October, and that its new acquisition would contribute to earnings-per-share positive in the first year of ownership. On completion, certain members of the Amec Foster Wheeler Board will join the board of the combined group: Roy Franklin will join as deputy chair and senior independent director, and Ian McHoul and Linda Adamany will be appointed as non-executive directors. In total, 294.5 million shares in John Wood will be issued, bringing the group total shares issued overall to 677.7 million shares.

For Amec, the sale was an attempt to receive regulatory approval for its merger with Wood Group after Britain's Competition and Markets Authority said in August the transaction could lead to competition concerns in the supply of engineering and construction services and operation and maintenance services in the UK.



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