Oil services deal
Wood offloads industrial services business to Kaefer
Wood’s Aberdeen head office
Energy company John Wood Group has sold its industrial services business to Kaefer, a technical services provider, for $104 million (£80m).
There is a further payment of up to $14m (£10m) pending achievement of agreed financial goals.
Aberdeen-based Wood regards the divestment as another important step in rationalising its portfolio and follows the sale of the company’s nuclear business, announced last August 2019 and due to complete this quarter. Cash proceeds from the disposals will be used to reduce debt.
Wood’s industrial services business provides integrity and fabric maintenance for assets in the marine, process energy, offshore oil & gas and infrastructure sectors across the UK and Ireland.
In 2018, the pre-tax profits for Wood’s industrial services business was $8m, while gross assets at year-end amounted to $105m.
David Kemp, Wood’s chief financial officer said: “The sale of our industrial services business is the latest divestment aimed at maintaining our strong balance sheet and achieving our target leverage.
“As our focus has moved towards building a premium, differentiated and higher-margin business, the industrial services offering is no longer core to our strategy.
“However, it is an excellent fit with Kaefer who see a clear opportunity to grow the business further and extend its market share across new sectors and geographies.”
Law firm Pinsent Masons advised Wood on all aspects of the sale.