Last time I wrote on this topic, things were seeming a little sketch but they were moving along. The tl;dr of this whole thing is that Wood Group is now, as of 2026-03-11, a fully owned subsidiary of Sidara. For transparency, as of this writing, I am still employed at Wood.

Things that happened after 2025-04-22 not being in order:

  • FCA announced investigation and summary fine of £13M GBP earlier in 2026
  • Sidara’s bid decreased from 35p to 30p per share
  • Wood finally released 2024 FY and 2025 H1 results.
  • Wood voted Yes to acquisition and to emergency measures caused by reduction in value to keep on borrowing beyond the bylaws
  • Ken G. resigned and the interim CFO, Iain Torrens, was promoted in his place. The 430(2B) terms of his departure mentioned in this press release were never publicly disclosed as far as I can tell
  • Interim CFO resigned after Sidara took over
  • Neil Bruce, former COO of Amec and CEO in SNC-Lavalin, took over on March 10. Board member musical chairs has been completed. Supposedly, he fought with the then-CEO about acquiring Foster Wheeler. Lost and was terminated, but if that’s true, I find that a very positive sign.
  • Because of the extremely foolish decision to rename to “woodplc.com” after the AFW acquisition and the protected use of “Plc”, everything is switching back to “woodgroup.com”. Have I mentioned how much disdain I have for the executive leadership who decided on that? The internal pain we felt with that migration (which is still not complete!) is not mentioned anywhere.

Ethics

The most insightful thing released to the market is the FCA report. It clearly found that the problem was especially pronounced in one group of Projects divisions (Minerals, Metals, and Life Sciences), and that the group in charge of ETHICS (AREC, or Audit, Risk, and Ethics Committee) failed to behave ethically.

What infuriates me is that engineers and other professionals are required at many points in their life or career to attest they are telling the complete truth[1] and behaving ethically, yet this was absent in the highest echelons of the company. Excerpt:

A meeting of AREC was held on 13 August 2024 to discuss the HY24 results, at which Wood Group’s auditors were also present. At this meeting, Wood Group staff took a robust approach to maintaining the FY23 position (including in relation to the HY24 DP), without disclosing their significant concerns as to the viability of this approach or its potential non-compliance with applicable accounting standards. They also did not disclose the alternative position being developed internally that would involve $140 million of exceptional wire-offs for HY24. This lack of transparency risked misleading AREC and Wood Group’s auditors and reflected a culture within Wood Group where issues were not raised with Wood Group’s auditors until they had been fully resolved and agreed internally. This was described by one individual as “toeing the party line”.

So, as a result of some project people somewhere in the company deciding to lie to their own managers, to finance, and to auditors, and as a result of some very high level employees deliberately not being honest with each other and auditors, Wood had to lose >90% of its shareholder value. Thanks!

Funnily enough, I have a very poor perspective of KPMG after taking a look at their controversies, and I thought KPMG was more at fault than one might expect based on other UK firms, that KPMG also supposedly audited, having gone through a similar thing. However, I am now thinking that the LSE is crazy because unethical accounting must flourish in the UK, and KPMG is caught up because either they are working with clients who are deliberately lying or they are just not-quite-competent-enough to catch companies in their lies before approving financial reports.

On Sidara

Obviously, it’s hard to say for sure how things will play out with new ownership going forward, but while there are some positive messages like this one, the fact that the “capital injection” offered earlier appears to be simply a loan. Please prove me wrong if you know otherwise, but looking at the terms found in the scheme document, these are the paragraphs I am citing:

Bidco and Wood entered into the Sidara Interim Funding Agreement on 29 August 2025 pursuant to which Bidco will provide a term loan facility of $250 million to Wood which will be available to draw upon, among other things, Wood Shareholders approving the Acquisition at the Meetings and the A&E Effective Date having occurred.

[…]pursuant to which Bidco has undertaken to provide (or procure that any of its affiliates provides) funding of $200 million to Wood within seven business days following completion of the Acquisition (the “Sidara Post-Completion Funding”). The Sidara Post-Completion Funding is required to be provided either as subordinated unsecured indebtedness or as equity (or another capital instrument) in Wood, provided that, in each case, the relevant funding instrument complies with certain conditions including that any distributions on that instrument are non-cash only and that any maturity or redemption date on such instrument is no earlier than the maturity date applicable to the Amended and Restated RCF, Amended and Restated Term Loan and Amended and Restated USPPs.

The Sidara Commitment Letter requires Wood and Bidco to negotiate in good faith to agree the long-form terms of the Sidara Post-Completion Funding, to the extent provided via debt financing, with a view to agreeing and executing definitive documentation on or prior to 21 November 2025

Only the post-completion offers equity as a potential, but the wording of the subsequent paragraph suggests it’s going to be debt.

I look at other M&A where the acquirer pays off the debts of the target, but no, not in this case. Instead, Wood is given more loans at a similar terms to other debt. Part of the reason it took SO LONG to propose the scheme and get a shareholder vote was due to having to get buy-in from the debt owners. Why? To clawback your relatively small investment using interest? To watch the employees grow disheartened by perpetual austerity? To avoid a larger capital outlay at first so that, if Wood implodes, you only lose hundreds of millions?

Again, rationale or thinking is never explained. Private equity is beyond mere mortal comprehension. To Sidara’s credit, however, it does not appear that they are intending to destroy Wood. I have not been able to determine quite where we are heading, but overhauling leadership with fingers crossed competent people is not something you would do if you were intending to behave unethically with a new company you bought.

Lessons

  1. Allowing unethical people into your organization and allowing them to proliferate is unacceptable. It will always come back to bite you. The fact that Wood did not immediately fire everyone and attempt to press criminal charges demonstrates what kind of leadership we had.
  2. It turns out, you do not need to pay the Enterprise Value of a company to acquire it; you simply don’t pay the debt at all (in fact, add to it for good measure) and get to take over. Not sure what message that sends. Prudent investing, perhaps, when viewed externally? Feels like a dismissive and antagonistic attitude internally, however.
  3. Do not engage with employee stock plans in super large companies that aren’t in vogue (e.g. AI in 2025/2026). Your exposure to hidden insanity is simply too high. You never know what a corner of the company is doing behind everyone’s backs, how it can doom the entire company by deleting all of the positive work you have ever done and ever will do, or how super high level employees who have nothing to lose by doing right by shareholders or the market will just decide to cover things up.

Similar to my first post in this series on financial literacy, as John Tracy says in his books on financial reports:

[The] balance sheet is where losses go to hide, cash goes to die, and the bullshit goes to lie

The balance sheet, especially one that was so thoroughly comprised of intangible assets, forces you, the reader, to make a guess as to how honest, forthcoming, and proactive a company is. Turns out, when they aren’t, consequences are devastating. At least Wood Group survives to live another day, and people’s lives were not upended dramatically. I just wish powerful people were held to account; a £13M pound fine for approximately £2B in shareholder value destruction is a decision. I guess it’s legal to torch equity if you get put in charge through legal means…

[1] I think this is a little complicated. Complete is probably not the correct term. The current society and people living in it would not tolerate complete honesty. I think there is a balance to be struck, and while I am not smart enough to articulate where the needle should point exactly, I feel that being honest and straight-forward must be required even if it’s not always the complete truth.