British Oilfield Services Firm Eyes Middle East Expansion During Takeover Discussions

British oilfield services and engineering company John Wood Group Plc is setting its sights on expanding its presence in the Middle East, even as it negotiates a potential takeover by Dubai-based engineering and consulting firm Sidara. This move comes amid growing demand for energy transition solutions in the region.

Wood Group revealed plans to establish an energy transition hub in Abu Dhabi by August 2024. Gerry Traynor, the company's senior vice president for Middle East projects, highlighted the increasing interest in the company's offerings related to carbon capture, renewable energy, and hydrogen solutions.

This push for regional growth coincides with ongoing acquisition talks between Wood Group and Sidara. Earlier in June, Wood Group entered discussions with Sidara regarding an improved takeover offer, having previously rejected three bids from the Dubai-based firm. Sidara's latest proposal values Wood Group at 230 pence per share, representing a 52% premium over the company's pre-bid share price. The news has boosted Wood Group's stock price, which has risen nearly 19% since the beginning of the year.

Analysts believe that Wood Group's focus on the Middle East aligns strategically with the region's evolving energy sector. Many countries in the Middle East, major oil and gas producers, are aiming to diversify their economies and incorporate more sustainable energy sources. Wood Group's expertise in capturing carbon emissions and developing renewable energy solutions positions them to capitalize on this shift.

The establishment of the Abu Dhabi hub is a significant step for Wood Group in the region. The hub will serve as a central location for the company's energy transition projects and will house a team of specialists focused on developing and deploying these solutions across the Middle East.

While the takeover talks with Sidara are ongoing, Wood Group's commitment to expanding its Middle East footprint remains clear. The company sees the region as a key market for its energy transition expertise and is actively positioning itself to play a leading role in the development of a more sustainable energy future for the Middle East.

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