Amec Foster Wheeler has agreed on a takeover by Wood Group worth £2.2bn (US$2.68bn)
In a deal that will bring together two of the United Kingdom's largest energy service companies, Wood Group and Amec Foster Wheeler have agreed on a multi-billion dollar takeover deal. The deal will create a company with a value of around £5bn (US$6.08bn).
Wood Group hope that they can cut around £110mn (US$134mn) in costs from the combined business. The sectors covered by the new combined business will include the oil and gas, chemical and mining sectors.
On 14 March, the shares in Amec Foster Wheeler increased by 14.7 per cent to GDP 5.61 (US$6.82) per share. The share price of Wood Group also grew by 4.4 per cent to GDP 7.85 (US$9.54) per share.
According to the BBC, Mark Wilson, an analyst at Jefferies, said: "While materially above our Amec valuation, we can see Wood Group consolidating its market-leading UK North Sea business, expanding product lines in the US and possibly increasing the scope for asset sales."