Oil and gas services giant Wood Group is making further inroads into the automation and controls market with the $59 million (£45.5m) acquisition of a US company that counts car-maker General Motors among its clients.
Aberdeen-based Wood, which already has a robotics arm that works with the likes of Jaguar Land Rover, is paying an initial $44m in cash for Michigan-headquartered CEC Controls, with a further $15m payable over the next three years.
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CEC was established in 1966 and has more than 220 staff across 12 offices in North America and a site in Romania. As well as General Motors, the management-owned firm – which specialises in industrial and process control systems for the car industry and made an underlying pre-tax profit of $9.6m last year – has clients including Ford and Fiat-Chrysler.
Robert Scheper, president of CEC Controls, said: “Wood Group’s global footprint and breadth of capabilities offers us the opportunity to enhance our client solutions and access significant international growth opportunities.
“We believe our extensive expertise in the automotive manufacturing industry, married with Wood Group’s two decades of experience in automation and control, creates a powerful solution-driven service offering for clients.”
The deal was announced after Wood revealed that it has offered to sell the majority of Amec Foster Wheeler’s North Sea oil and gas business to avoid competition concerns over its £2.2 billion takeover deal.
Amec’s North Sea business employs around 4,200 people providing services including maintenance.
Wood chief executive Robin Watson said: “Bringing 50 years of expertise in delivering services to the automotive sector, CEC Controls significantly complements and strengthens the innovative technical solutions we provide to clients within automation and control.
“The acquisition supports the geographical broadening of our footprint within the automotive sector particularly in the US; deepening our presence in the key automotive hub of Detroit, where CEC Controls is headquartered.”
He added: “It also provides us the opportunity to further enhance the industrial process and control capabilities we offer to this industry and adjacent sectors including aerospace, logistics, water, and pharmaceuticals.”
• Aberdeen-based energy services company Proserv has been awarded a series of contracts worth a total of more than $11m in the Middle East.
In the UAE, the firm is set to engineer and manufacture wellhead control panels, hydraulic power units and chemical injection systems to national oil companies, service businesses and engineering, procurement and construction specialists. Earlier in the year, Proserv officially opened its new Saudi Arabia facility.