UPDATE 3 — Oil and gas services company Amec Foster Wheeler — which has agreed to be taken over for £2.2 billion by Aberdeen-based Wood Group — said late on Tuesday it is under investigation by the Serious Fraud Office (SFO).
Amec Foster Wheeler said the SFO’s investigation “is not expected to have an impact on the completion of the merger of Amec Foster Wheeler and John Wood Group” which is expected to take place in the fourth quarter of this year.
However, on Wednesday morning Wood Group shares fell about 8% and Amec Foster Wheeler shares fell roughly 9%.
The SFO said in a statement: “The director of the Serious Fraud Office has opened an investigation into the activities of Amec Foster Wheeler plc and any predecessor companies owning or controlling the Foster Wheeler business, together with the activities of any subsidiaries, company officers, employees, agents and any other person associated with any of these companies for suspected offences of bribery, corruption and related offences.”
Shareholders of Wood Group and Amec Foster Wheeler last month overwhelmingly approved Wood Group’s roughly £2.2 billion recommended all-share offer for Amec Foster Wheeler.
The deal, though, remains subject to clearances from competition authorities in certain countries where both companies operate.
Wood Group’s biggest ever takeover would create a combined firm with a stock market value of about $6 billion, according to Bloomberg data, making it among the biggest oil services companies in Europe, ahead of Petrofac and of Saipem SpA.
Amec Foster Wheeler said: “In its circular to shareholders published on 23 May 2017 the company disclosed that the UK Serious Fraud Office (SFO) may well commence an investigation into Amec Foster Wheeler.
“The company confirms that today it has been informed by the SFO that it has now opened an investigation into Amec Foster Wheeler, predecessor companies and associated persons in respect of the Foster Wheeler business.
“The investigation focuses on the past use of third parties and possible bribery and corruption and related offences.
“Amec Foster Wheeler takes its obligation to conduct business ethically very seriously and has in place a robust global anti-bribery programme, including a detailed code of conduct and anti-bribery and corruption policies.
“Amec Foster Wheeler continues fully to co-operate with and assist the SFO.
“Given the stage of this matter, it is not possible to estimate reliably what effect the outcome of it may have on Amec Foster Wheeler.
“However, the SFO’s investigation is not expected to have an impact on the completion of the merger of Amec Foster Wheeler and John Wood Group, which is expected to take place in the fourth quarter of this year.”
Wood Group said in a statement: ” … it is not possible to estimate reliably what effect the outcome of this matter may have on Amec Foster Wheeler.”