Wood Group shares chopped as £1.7bn private equity swoop axed
ONE of the biggest takeovers in private equity’s bid pipeline collapsed today to leave shares in oilfield services firm Wood Group back where they started the year.
Apollo’s decision not to make a £1.7 billion takeover offer ends a saga in which Aberdeen-based Wood turned down four previous proposals. Last week, Apollo also dropped a potential bid for Hut Group e-commerce company THG.
The developments follow a flurry of interest in London-listed firms so far this year, with Dechra Pharmaceuticals and payments firm Network International among others in the sights of the private equity industry.
For Wood, the loss of its bid premium meant shares slumped by a third or 73.3p to 145.7p. The company said today that it is well placed to deliver “substantial value for shareholders”, having recently reported good trading momentum and also set out a series of medium-term earnings targets.
The private equity focus clouded the performance of the mid-cap FTSE 250 index, which stood just 3.65 points higher at 19,192.02.
In contrast, the FTSE 100 index added 21.05 points to 7775.67 as major global markets continue to make progress despite economic storm clouds and next month’s deadline for the United States to avoid a debt default.
The most significant milestones were in Germany, where the Dax touched its highest level since January 2022, and in Japan as the Nikkei 225 added 0.8% for an 18-month peak.
In London’s top flight, Flutter Entertainment was among the frontrunners as analysts at Citigroup gave the betting giant a 19,000p target. Shares rose 195p to 16,115p.
Other strong performers came from the banking sector, but oil stocks were under pressure after Brent Crude futures started the week near $74 a barrel against $85 a month ago. Shell fell 14.5p to 2394.5p while Tullow Oil lost 0.8p to 23p in the FTSE 250 index.
It was also another grim session for Asos, with the fast-fashion chain down another 11% or 58p to 447p as the sell-off following last week’s results continued.
On a brighter note, seals and controls business Diploma rose 72p to 2922p as it upgraded full-year guidance alongside interim results showing a 33% rise in operating profits to £109.7 million.