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John Wood Group PLC on Wednesday announced it is selling its Built Environment Consulting business to WSP Global Inc for about $1.9 billion gross.
John Wood said it will use the proceeds from the sale to reduce its debt and strengthen its balance sheet. The firm ended 2021 with net debt of about $1.4 billion and anticipates a higher net debt at June 30 due to its typical working capital outflow. ‘Excluding the proceeds from the sale of our Built Environment business, we expect no improvement in net debt in 2022 compared to 2021,’ it explained.
It expects to be in a net cash position with the sale proceeds.
John Wood said its outlook for 2022 remains unchanged. It will publish a trading update for the half year ending June 30 on July 7.
‘We are very pleased to have agreed this sale with WSP. This transaction will deliver significant value for our shareholders and marks a new chapter for Wood. It enables us to move onto our next strategic phase with the financial flexibility to accelerate our strategy to capture the growth opportunities ahead across both energy security and sustainability,’ said Chief Executive Officer Robin Watson.
The sale is expected to complete in the second half of 2022.
John Wood Group shares were 2.2% lower at 233.40 pence each in London on Wednesday morning.
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