Wood Group agrees sale of EthosEnergy, CEC Controls for $165m
By Michele Maatouk
Date: Wednesday 28 Aug 2024
(Sharecast News) - Wood Group said on Wednesday that it has agreed the sale of two businesses for around $165m as part of its programme to dispose of non-core businesses.
The company said it had signed deals for the sale of its stake in EthosEnergy, a joint venture focused on rotating equipment, and CEC Controls, which is an industrial and process control systems business in the automotive market.
Combined, the two businesses contributed $41m to Wood's adjusted EBITDA in 2023.
Wood expects net cash proceeds of around $125m from these disposals when they complete, which is expected to be later this year.
In addition, Wood will be issued loan notes by EthosEnergy which, on repayment around five years after completion, will generate further proceeds of up to $42m plus interest.
Chief strategy officer Jennifer Richmond said: "The sale of these two non-core businesses is further evidence of progress of our strategy. We continue to review Wood's portfolio in line with our strategic priorities to be selective in our markets and capabilities and steadfast in our commitment to simplify Wood and deliver greater cash flexibility.
"There is a strong strategic fit between both these companies and their buyers, and we are confident both businesses will thrive under new ownership."
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