Wood Group said it was “considering rejecting” a fourth cash offer from Apollo Global after its energy services business previously rejected three offers from US private equity groups.
The sweet offer would value the FTSE 250-listed company at 237p a share or about £2bn, up 3 per cent from the previous proposal of 230p a share.
“The board believes this latest proposal continues to undermine the group and therefore rejects it [it]”said Wood Group in a statement on Tuesday.
The takeover attempt comes as the Aberdeen-based company faces pressure from activist shareholders to boost its share price.
Sparta Capital, founded in 2021 by former Elliott Management portfolio manager Franck Tuil, asked Wood Group to buy back shares to lift its value. Investment firms have warned that Wood Group’s “significant undervaluation” makes it vulnerable to takeovers.
Apollo’s previous offer on January 26 offered 230p per share, a 55 per cent premium compared to Wood’s share price at the time and the equivalent of around £1.9bn, net of debt.
Wood Group shares gained more than 14 percent to trade at around 222p per share during Tuesday morning trading in London.
“The company’s board will continue to engage with shareholders and intends to engage more, to a limited extent, with Apollo”.
A representative for Apollo declined to comment.
The Scottish company provides consultancy, asset management and engineering services to the energy and materials sector, and has recently expanded into clean energy projects such as wind farms. Its revenue last year rose by around 8 per cent to $5.4bn.
Apollo is pursuing Wood Group as the majority of FTSE 250 bosses believe the UK-listed company is vulnerable to foreign takeovers this year, amid expectations that M&A activity will pick up as economic conditions improve.
Another US fund, Providence Equity, has made a takeover approach for the London Hyve-listed exhibition company, a move some top shareholders have called “opportunistic”.
Under UK takeover regulations, Apollo has until March 22 to declare its intention to make an offer for Wood or leave.