Amid the expected closing in the coming days of its acquisition by Dubai consultancy Sidara Group, UK engineer and energy contractor Wood Group has been fined $17.4 million by its home country’s financial regulator for the alleged publication of inaccurate information in the company’s latest financial results.
In a statement on March 4, the Financial Conduct Authority pointed to breaches in Wood Group’s 2022 and 2023 full-year and half-year 2024 results that were delayed, saying the company “failed to take reasonable care to ensure that its announcements about those results were not false or misleading”.
The agency’s findings for the period from January 1, 2023 to November 2024 concluded that following cost overrun issues on certain lump sum projects, “Wood Group’s accounting judgments were inappropriately influenced by its desire to maintain previously established financial results.” He said the company “did not have adequate systems, controls or procedures in place to prevent this from happening”.
Wood Group was also audited last year in a review commissioned by the board of accountancy firm Deloitte. The UK financial agency said Wood accepted the findings of the investigation, which took nine months to complete, reducing his financial penalty by 30%. The fine must be paid before March 17.
“Wood cooperated fully with the [agency] “The company has developed a governance and corrective action plan to address the issues identified in the independent review and has taken steps to implement the plan.”
Wood Group’s pending $285 million takeover bid, while well below previous offers made by Sidara over the past three years in a long-running saga of transactions, “represents the best option for its shareholders, creditors and wider stakeholders,” the British firm’s board said. The shareholders of the two companies approved it last year.
The fine announcement comes ahead of a March 6 court hearing in London to rule on the Sidara purchase, with Wood expecting the deal to be completed by March 10, assuming court approval. A spokesman for Wood declined to comment to the media about whether the announced penalty will affect the acquisition.
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Wood Group’s interim finance director Iain Torrens was appointed chief executive last November and Jade Moore joined the company on 1 December as the new finance director.
Torrens said the company “is well-positioned to benefit from significant long-term growth drivers” in the global energy and materials markets. The purchase will include a $250 million funding infusion from Sidara and access to the tie-up of about $200 million. “This transaction allows us to strengthen customer relationships, expand into new markets and serve a wider range of global customers,” said Sidara CEO Talal Shair, with Wood Group becoming Sidara’s energy and materials division and set to retain its brand.
Wood announced that as of last December, it had secured more than $1 billion in oil and gas contract wins in the Middle East by 2025, marking the second consecutive year of record sales bookings in the region. The figure represents a 20 percent increase in awards compared to 2024, with wins in the United Arab Emirates, Iraq, Saudi Arabia, Bahrain, Kuwait, Oman and Qatar, the firm said. The award includes the engineering, procurement and construction management (EPCM) contract to expand the ADNOC Gas Habshan plant in the United Arab Emirates.
