International energy services company Wood Group is to acquire fellow global player Production Services Network for £606m.
PSN will merge with Wood Group’s oil and gas production facilities business to create what will become the world’s leading brownfield production services provider, to be called Wood Group PSN.
PSN’s chief executive Bob Keiller will head the new company, with Wood Group Production Facilities’ chief Les Thomas as his deputy.
Mr Keiller said: “This transaction positions us for the next stage of PSN’s development, enabling us to strengthen our service capability to existing and new customers whilst providing enhanced career prospects for our people. Wood Group PSN will retain our clear commitment to safety, excellence in service delivery, innovation and continuous improvement, allowing us to continue to build lasting and strong relationships with clients.”
Wood Group chief executive Allister Langlands said the deal would give his company “a larger footprint, deeper resources and capabilities”.
He added: “The combined business will be better positioned to help tackle current key industry issues, including operational assurance, competency, reliability and asset integrity.”
The acquisition was backed by Lloyds Banking Group’s Corporate Markets team in Aberdeen. The bank’s Stuart Brown said: “A transaction of this magnitude requires a deep understanding of the oil and gas services sector and we have been consulting with Wood Group for some time to ensure we found the right financial package to meet their needs. The acquisition fits well for both businesses and we are sure the combination will be highly successful for all parties.”
Lloyd’s managing director of corporate markets, Alasdair Gardner, added: “This demonstrates our strong appetite to provide strategic debt solutions for our customers. Lloyds Banking Group is pleased to support such a major global plc in its strategic plans with an acquisition of another high profile, successful, global business.”
Wood Group employs more than 29,000 people worldwide and operates in 50 countries. PSN has more than 8,000 staff in 23 countries.