Editing Openai/6952b500-851c-8011-9361-2f64632b350b (section)

=== Assistant: There are several concrete reasons why Wood Group’s John Wood Group PLC share price is trading so far below the offer p… ===
There are several concrete reasons why Wood Group’s (John Wood Group PLC) share price is trading so far below the offer price, and why the market isn’t marking the stock up to the takeover level (e.g., 30p offer) until the deal is completed:

===== The current offer (around 30p per share) from Sidara is not yet final and unconditional — it’s subject to regulatory, financial and shareholder conditions. Markets will often discount a share price below the offer until all conditions are satisfied or a firm offer is declared. If there’s a real chance the deal could be renegotiated or fall through, the share price may stay well below the offer level. =====

===== Wood Group has been facing major financial headwinds: =====
* Significant revenue declines and lower profitability in recent periods. Investing.com<ref>{{cite web|title=Investing.com|url=https://www.investing.com/news/company-news/wood-group-reports-h1-2025-revenue-down-133-amid-financial-challenges-93CH-4321226|publisher=investing.com|access-date=2026-01-01}}</ref>
* Large free cash flow outflows and high net debt levels. Investegate<ref>{{cite web|title=Investegate|url=https://www.investegate.co.uk/announcement/rns/wood-group-john---wg./hy25-results-replacement/9204875|publisher=investegate.co.uk|access-date=2026-01-01}}</ref>
* A substantial pre-tax loss in the latest accounts (e.g., reported impairments). ADVFN<ref>{{cite web|title=ADVFN|url=https://uk.advfn.com/market-news/article/7750/wood-group-shares-soar-as-trading-resumes-after-five-month-suspension|publisher=uk.advfn.com|access-date=2026-01-01}}</ref>

Investors typically price in financial weakness, especially when there’s risk of further dilution, debt refinancing issues or restructuring.

===== The company uncovered accounting errors and oversight failures that delayed its results and caused a trading suspension earlier in the year. Investing.com<ref>{{cite web|title=Investing.com|url=https://www.investing.com/news/stock-market-news/wood-group-shares-drop-25-after-accounting-issues-delay-fy24-results-3956474|publisher=investing.com|access-date=2026-01-01}}</ref> That episode eroded investor confidence and heightened perceived risk, which keeps the share price lower. =====

===== The London Stock Exchange suspended the share while financials were being audited and restored only recently. Trading suspensions create illiquidity and uncertainty, which usually suppress share prices until clarity returns. ADVFN<ref>{{cite web|title=ADVFN|url=https://uk.advfn.com/market-news/article/7750/wood-group-shares-soar-as-trading-resumes-after-five-month-suspension|publisher=uk.advfn.com|access-date=2026-01-01}}</ref> =====

===== Wood’s liquidity position and debt maturities have been major concerns. Market participants have been worried about refinancing risk and whether lenders might demand asset sales or other actions that could reduce shareholder value if the takeover fails. Press and Journal<ref>{{cite web|title=Press and Journal|url=https://www.pressandjournal.co.uk/fp/business/local/6848267/wood-group-chairman-warns-shareholders-could-be-left-with-nothing-if-they-dont-back-30p-takeover-offer/|publisher=Press and Journal|access-date=2026-01-01}}</ref> =====

===== Even before the recent turmoil, the company’s market valuation had plunged from near 880p per share several years ago to the current levels, largely because of underperformance, restructuring costs, and loss-making contracts. This long history of downgrades and negative surprises weighs on valuation sentiment. Press and Journal<ref>{{cite web|title=Press and Journal|url=https://www.pressandjournal.co.uk/fp/business/local/6887751/wood-group-shares-surge/|publisher=Press and Journal|access-date=2026-01-01}}</ref> =====

===== A takeover bid price may act as a ceiling for where the share trades in the market — but the stock will often trade noticeably below that until: =====
* The bidder makes a firm offer under the Takeover Code,
* All conditions are met (regulatory, financing, audited accounts), and
* **Shareholders accept the bid.

Until then, the price reflects:
✔ the risk the offer could be lowered
✔ the possibility it might be withdrawn
✔ the risk of other financing outcomes
✔ discount for company risk and market conditions

===== Wood Group shares are trading well below the offer price primarily due to: =====
* Takeover uncertainty and conditionality
* Poor recent financial performance and debt concerns
* Accounting problems and market suspension
* Investor risk discount and illiquidity

If the takeover becomes unconditional and final, the stock will usually gravitate closer to the offer price — but until then, the market prices in the risk that things might not go through at that price or at all.

If you want, I can go into how likely it is the takeover will complete and what happens to your shares in different scenarios.