Wood Group £2.23 billion acquisition of Amec Foster Wheeler

Overview:

• Wood Group has agreed to acquire Amec Foster Wheeler for £2.23 billion.
• The combined group will be one of the largest oil and gas services companies in Europe with a market value of £4.9 billion.
• Both companies provide services to infrastructure, renewable energy and UK North Sea oil companies.
• Amec shareholders will receive 0.75 new Wood Group shares for each Amec share.
• Amec had intended to undertake a £500 million share rights issue this week, according to the Financial Times, but this has now been suspended.
• The deal was funded via a $1 billion three year term loan facility and a $1.75 billion five year revolving credit facility underwritten by BNP Paribas, HSBC, JPMorgan, Lloyds and RBS.
• JPMorgan and Credit Suisse advised Wood Group. Goldman Sachs, Bank of America Merrill Lynch and Barclays advised Amec.
• The oil service sector has come under pressure in recent years due to low commodity prices and the deal is a latest in a string of North Sea deals completed in the past few months including Chrysaor Holdings' £3 billion acquisition of Shell North Sea oil assets, Siccar Point Energy's $1 billion acquisition of OMV UK and Delek's £518 million acquisition of Ithaca Energy.

Sam Duke - Editor