WOOD is to sell its nuclear business to Jacobs for £250m (US$303.5m). The sale proceeds will go towards reducing Wood’s debt from its 2017 purchase of Amec Foster Wheeler.
The Financial Times reports that Wood’s net debt increased to US$2bn after its US$2.2bn purchase of rival Amec Foster Wheeler in 2017. The report says that debt had fallen to US$1.5bn by December 2018, adding that in May, Wood sold its TNT Materials Handling business for US$41m.
Wood’s nuclear business delivers, and maintains “strategic and complex” nuclear assets, primarily for UK customers. The business has more than 2,000 employees. Jacobs expects that combining Wood’s nuclear team with its existing Aerospace, Technology, and Nuclear business will provide a platform for growth in nuclear and defence in the UK, and increased access to Europe and Asia. Further strategic and financial benefits are also expected.
The acquisition is expected to close before the end of Q1 2020.
David Kemp, Chief Financial Officer at Wood, said: “The sale of our nuclear business follows other recent divestments and marks a significant step towards achieving Wood’s target leverage policy.”
Steve Demetriou, CEO and Chair of Jacobs, said: “This acquisition further strengthens Jacobs’ position in highly profitable and complementary sectors within nuclear and defence…”
Amec Foster Wheeler was a consultancy, engineering, and project management company. It was formed in 2014 when AMEC purchased Swiss engineering conglomerate Foster Wheeler in a £2bn deal.
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