Wood Group (john) Share Discussion Threads

[pogue] 15/3/2023 12:10

All the big contractors are changing what they do and how they do it and closing business that doesn't fit with their strategy. Fixed price contracts are out and renewables are in is the general main themes.
I was at a contractor couple of years ago that refused to take an extension offered by the client to continue being the onsite contractor for a gas field as it did not suit the type of work they wanted to focus on. Madness as it was easy money but there you go that's how the industry is changing, it is in general much more risk averse.

[wendsworth] 15/3/2023 10:26

brucethegoldfish: Probably part of the on-going rationalisation and turnaround of the company's fortunes. Interesting times beckon for shareholders.

[brucethegoldfish] 14/3/2023 19:57

Wood Group announced earlier today the sale of its offshore labour supply operations in the Gulf of Mexico to Louisiana-based energy services contractor, Danos.

The sale was for cash consideration of $17 million, an EV/EBITDA multiple of around 8x, including working capital.

Wood's offshore labour supply operations in the Gulf of Mexico contributed around $90 million of revenue and around $3.5 million of adjusted EBITDA in 2022. It employs around 700 people.

I wonder what, if any, bearing this deal possibly has on ongoing discussions with Apollo?

[wendsworth] 14/3/2023 16:10

Quiet BB awaiting....!After expected share price re-trace looks like 'it wants to go back up'? This month could well prove pivotal. Finals will require careful consideration.

[pogue] 10/3/2023 09:13

If you want some positive news from the coal face the rates are going up for engineers as the number of jobs are increasing. Most, if not all, of the work is large FEEDs for gas or LNG projects around the world. FEEDs lead to detailed design and they will be big contracts judging by the length of the FEEDs.
Aberdeen is still dead from what I can see and will remain so for a few years due to the government's windfall tax and the bigger one Labour have promised when they get elected. Pretty soon there will be no one stupid enough to work in the banana republic run most expensive oil sector in the world that will do wonders for the UKs treasury receipts, not.
Bad trip to the office today.

[wendsworth] 09/3/2023 19:47

pogue: Thank you for your thoughtful succinct response based upon your wealth of experience in the sector. As ever it will nonetheless be interesting to see how things pan out. I am particularly interested in The Finals due on 28/03.

[pogue] 09/3/2023 17:15

wendsworth
only point I would agree with you on is WG is undervalued.
Shell BP etc dont care if WG goes to someone else if there is a new owner it makes no difference to them just like WG buying FWEL. Plenty of contractors out there if for some reason the new owners decided to ruin the business which I don't think they would.
There is zero chance of WG being weaved into BP or Shell they have their own internal engineering divisions and it is more cost effective to have outside contractors compete for work and supervised by their engineers.
I talk from having worked in the contracting industry for all my working life.

[wendsworth] 09/3/2023 16:37

Boozey : Perfectly sensible approach. Where I would beg to differ is on your downside estimate going forward. WG is way undervalued. It is an important Scottish company that provides key support to the Oil and Gas industry. My view is that neither Shell or BP would wish WG to fall into the hands of ruthless asset strippers. Weaving WG into either would be extremely beneficial and in effect cost either of them 'chicken feed'. It is for that reason that I have doubled my holding this week. For the record WG is the only share I hold.

[hamhamham1] 09/3/2023 14:32

Its only polite to say no twice ;)

[sundance13] 09/3/2023 14:28

Somethings going on I reckon, 2 suspicious spikes now!

[hamhamham1] 09/3/2023 14:27

225p.... Nice :)

[chutes01] 09/3/2023 13:22

next leg up coming
LT holders being sold down the river here, Management weighed in for a cheap deal
Retention bonuses to sell deal
£8 - £1 abject incompetence, now being rewarded at the expense of shareholders.
Take £3 and write it off as a bad experience.

[brucethegoldfish] 09/3/2023 13:02

I’ve now taken 1/3rd of my holding off the table built from the 130-140p range.

Prepared to wait it out though for the remaining 2/3rds, bid or no further bids as still see huge potential upside in value here over the mid-term.

[hamhamham1] 09/3/2023 12:56

Maybe more takeover rumours caused it?

[hamhamham1] 09/3/2023 12:50

Nice little spike up ;)

[iconista] 09/3/2023 08:37

With this company, I've been guided by the shorts. Currently none above 0.5% for the first time in 7 years.

[boozey] 08/3/2023 12:28

Taking a purely short-term view, the equation for PIs is simple: Likely top-end agreed takeout price: 250p. Risk downside if negotiations collapse 160p. That represents around 35p upside versus 55p downside assuming a current price of 215p. I have split my risk taking 50% off the table, and will chance my luck with the other 50%. Given we have had 4 bids I think a positive outcome is more likely than not - especially given that Wood Group is engaging with Apollo albeit on ''a limited basis''

[gargoyle2] 08/3/2023 12:20

So speculation then. That makes more sense. I read it as you knowing they were doing that.

[wendsworth] 08/3/2023 12:12

Gargoyle2:The short answer is you can't! As you'll be aware every transaction in the market is COMPLETELY TRANSPARENT !! I suppose the question I would put to you is , 'What would you do?'. Cayman, Isle of Man, Jersey , Singapore, British Virgin Islands,Honk Kong, Switzerland, Bermuda, Luxenmbourg, The Netherlans , United Arab Emirates and OUT !!!!!

[gargoyle2] 08/3/2023 09:03

wendsworth, how can you tell that Apollo is buying? Have I missed an RNS? Or is that just speculation?

[wendsworth] 08/3/2023 08:48

ashkv: The drip drip approach is extremely cunning. Whatever the outcome Apollo has been , and is continuing, to hoover up weak holdings through various 'vehicles' and thus guaranteed a substantial profit. The Finals will be pivotal. If a Special Dividend is declared then its game on!

[ashkv] 08/3/2023 07:02

Apollo’s fourth takeover offer ‘continues to undervalue’ Wood Group
Scottish company says board is ‘minded to reject’ US private equity group’s latest proposal

Ivan Levingston and Maxine Kelly in London YESTERDAY

Wood Group said it was “minded to reject” a fourth cash offer from Apollo Global after the energy services business previously spurned three bids from the US private equity group.

The sweetened offer would value the FTSE 250-listed company at 237p a share or roughly £2bn, a 3 per cent increase from its previous proposal of 230p a share.

“The board believes this latest proposal continues to undervalue the group and is therefore minded to reject [it],” Wood Group said in a statement on Tuesday.

The takeover attempts come as the Aberdeen-based company faces pressure from an activist shareholder to boost its share price.

Sparta Capital, founded in 2021 by former Elliott Management portfolio manager Franck Tuil, has called on Wood Group to buy back its stock to lift its valuation. The investment company has warned that Wood Group’s “significant undervaluation” makes it vulnerable to a takeover.

Apollo’s previous bid on January 26 offered 230p per share, a 55 per cent premium compared with Wood’s share price at the time and equivalent to approximately £1.9bn, taking net debt into account.

Wood Group shares gained more than 14 per cent to trade at about 222p per share during Tuesday morning trading in London.

The company’s “board will continue to engage with its shareholders and intends to engage further, on a limited basis, with Apollo”.

A representative for Apollo declined to comment.

The Scottish company provides consultation, management of assets and engineering services for the energy and materials sector, and recently expanded into clean energy projects such as wind farms. Its revenues last year rose about 8 per cent to $5.4bn.

Apollo is pursuing Wood Group at a time when the majority of FTSE 250 bosses believe UK-listed companies are vulnerable to foreign takeovers this year, amid growing expectations that mergers and acquisitions activity will pick up as economic conditions improve.

Another US fund, Providence Equity, has made a takeover approach for the London-listed exhibition company Hyve, a move that some top shareholders have called “opportunistic”.

Under the UK’s takeover regulations, Apollo has until March 22 to announce its firm intention to make an offer for Wood or walk away.

[sundance13] 08/3/2023 06:58

One final offer will do it I reckon, think 250p or thereabouts also, which would still be a bargain buy for them,

[ayl30] 07/3/2023 23:07

New £1.6bn offer from Apollo Global Management 'still undervalues' Wood Grouphttps://www.thetimes.co.uk/article/1867e080-bcd2-11ed-b039-425ba6c60d6d?shareToken=ed957712f342c0e78f16e72c18465d18

[wendsworth] 07/3/2023 21:44

This is not the 'Final Offer. Apollo are aiming to take the company out for 250p a share. Methinks a 'White Knight'approacheth.