The Wood nuclear business designs, delivers and maintains strategic and complex nuclear assets for customers primarily in the UK. At Sellafield, it is part of a joint venture delivering the £600m box encapsulation plant, for example. In 2018, it made a pre-tax profit of £12m and gross assets at year-end amounted to nearly £400m. However, the parent company wants to reduce its debt.
The deal is conditional on approval from regulatory authorities but is anticipated to close by March 2020. If the Competition & Markets Authority decides against clearing the deals, Jacobs has agreed to pay Wood £7.5m anyway.
John Wood chief financial officer David Kemp said: “The sale of our nuclear business follows other recent divestments and marks a significant step towards achieving Wood’s target leverage policy. Although our nuclear business is a strong UK player and has performed well, we see better opportunities to develop clear global leadership positions across other parts of our business.”
Jacobs chief executive Steve Demetriou said: “This acquisition further strengthens Jacobs’ position in highly profitable and complementary sectors within nuclear and defence, enhancing our recognised program management skills with deep, technical expertise.
“We are excited to welcome these talented employees to the Jacobs’ team. Given the compelling and synergistic fit of our two organisations, we believe this transaction will translate into significant value for Jacobs’ shareholders, diverse opportunities for our employees and new, differentiated nuclear and defence solutions for our clients.”