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PSN merges with Wood Group

PSN has entered into an agreement to merge the company with Wood Group’s Production Facilities business. In a deal valued at US$955 million, this merger is designed to create the leading global brownfield services provider with annual revenues of around US$3 billion.

The new company, to be named Wood Group PSN, will have an international workforce of 22,000 people operating in more than 30 countries. PSN’s directors will all be joining the new merged business with Bob Keiller as CEO and Duncan Skinner as chief financial officer (CFO). The management team for the new company will be made up of PSN management teams and Wood Group’s Production Facilities’ management team.
The new business will deliver the following benefits:
• increased exposure to the attractive US$50 billion per annum production facilities addressable market;
• increased international presence;
• extends and deepens strong long term customer relationships;
• proven management and global workforce; and
• comprehensive service offering.

Speaking about the merger, Bob Keiller CEO of PSN said: “I believe that by uniting PSN with Wood Group we have a unique opportunity to grow our business to benefit our customers and our people. Since the management buyout in 2006, we have achieved significant success and expansion. This transaction positions us for the next stage of PSN’s development, enabling us to strengthen our service capability to existing and new customers whilst providing enhanced career prospects for our people.

The combined new Production Facilities business will retain our clear commitment to safety, excellence in service delivery, innovation and continuous improvement, allowing us to continue to build lasting and strong relationships with clients.”

Allister Langlands, Chief Executive of Wood Group, added: “We are excited about combining the strengths of two extremely successful companies. The Acquisition advances our strategy of achieving long term sustainable growth by adding value to our customers’ global operations. We are confident that this will enhance our position as the leading production services business for our clients and our people, with a continued rigorous focus on safety.”

The transaction is subject to relevant merger approvals, including the Office of Fair Trading in the UK, and completion is expected in Q2 of 2011. Until then, PSN and Wood Group will continue to operate as separate and independent production services businesses.

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