Published: Tue, October 10, 2017
Money | By Armando Alvarado

Wood Group completes on AMEC acquisition

Wood Group completes on AMEC acquisition

The mega-deal reduces Wood Group's exposure to volatile upstream oil and gas industry services to around 55% of revenue, while opening the opportunity to develop Amec's environmental and infrastructure services business.

He was previously chief exec of oil services company Amec Foster Wheeler, which he joined previous year, and will take the role at Capita in December 2017.

It comes after the Competition and Markets Authority (CMA) expressed fears that the takeover gave rise to antitrust issues surrounding the supply of engineering and construction services, as well as operation and maintenance services in the North Sea.

That is the price tag for WorleyParsons to purchase AFW UK Oil & Gas, which provides engineering and construction services on the UK continental shelf.

The ASX-listed company plans to fund the acquisition through a $322 million, pro-rata entitlement offer.

"AFW UK is a world class integrated solutions business with best in class MMO capabilities and an excellent track record of worldwide expansion", Mr Wood said.

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"We look forward to combining AFW UK's capabilities with our worldwide platform to create a global MMO business capable of driving medium term growth".

The AFW assets are being offloaded by its vendor, British oil and gas company Amec Foster Wheeler, to address "competition concerns" in the United Kingdom market.

The acquisition is expected to be completed by the end of October 2017.

The company is selling AFW UK to address competition concerns raised in connection with the transaction between AFW and John Wood Group.

But later that month, the regulator said that if Amec sells most of its upstream offshore oil and gas assets, that "might be acceptable" as a pre-condition for the Amec-John Wood merger to proceed.

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