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The Wood Choppers Ball

Douglas Fraser | 06:31 UK time, Tuesday, 15 February 2011

It's not a bad day at the office, when you walk away with more than £200m.

That looks like the proceeds heading towards Sir Ian Wood, his family and its trust as a result of the sale of the Well Support division.

As you can hear in an interview with the Wood Group chairman, he's upbeat about the success of the division, built up over 20 years, as evidence that Scots can cut it in the industry.

Well support - including blow-out preventers, data logging and the pumps needed to coax oil and gas out of lower-pressure wells - was the toughest part of the industry to crack. But Wood Group cracked it. And some.

However, the company's directors decided last year that it ought to specialise, in an environment where projects are becoming humungous - one billion dollars has become relatively small, replaced by $20 to $30bn projects - where the industry giants are consolidating, and where there is limited synergy between the wellhead business and the main engineering and production services division.

That explains the £600m purchase in December of PSN oilfield services, also Aberdeen-based, which was already expanding fast and has now announced another 100 jobs.

It also helps explain why it has sold the Well Support division - GE winning the race with £1.75bn. Of that, £1.06bn is to be distributed among the company's shareholders.

Sir Ian controls 17% of the stock, and other family members and the trust take that above 20%.

Hence a pretty good payday, and perhaps significant news for the Wood Family Trust's philanthropic work.

I shall leave it to Aberdonians to argue - as they love to do - over its potential impact for plans to revamp Union Terrace Gardens, to which Sir Ian had offered £50m.

Comments

  • Comment number 1.

    Point of fact re: Union Terrace Gardens. The only plans existing prior were those of Peacock Visual Arts, costing £13.5m, with full planning permission and more than £9m secured. Wood had offered nothing to this, instead scuppering it with his own proposal - as opposed to an existing one.

  • Comment number 2.

    Stay clear of the fantasy business models of football, like the bankers the wages are out of control. Scotland needs to concentrate on high technology and re-creating manufacturing and engineering excellence that generates true jobs and wealth.

  • Comment number 3.

    Pity. This means that the well service sector is now once again dominated by mainly US companies. Wood has now gone back to his roots running a low value adding maintenance outfit.

  • Comment number 4.

    #3

    That's a bit harsh - they did operate as duty holder on the NNS assets during the transition from Shell to Taqa Bratani and performed more than competently in that role.

    It's no secret that Wood Group want to end up operating platforms and facilities just like the upstart Petrofac - they're just going about it a different way.

    #1

    I for one am happy for Sir Ian to do his thing both in business and insofar as Aberdeen's civic square is concerned.

    Just like Trump, he's defying the norm and investing heavily in Aberdeen with his own cash. If it weren't for the fact we were the poorest oil producing country in Europe - UK PLC might have seen some way to meeting, encouraging or even stumping up for some of that much needed investment; case in point being the 30 years-in-the-making western peripheral route - or "bloody bypass" we've all waited patiently for these many moons.

    Instead - we get London Olympics, Glasgow Commonwealth games and other sundry "prestige" events.

    My point being - Wood is spending the money here and so is Trump while all this time the city's been effectively neglected by consecutive UK governments who have chosen to ignore it in favour of white-city white elephants.

  • Comment number 5.

    Afore anyone accuses me of knocking a fellow scots success, just how much tax is avoided on this paltry £200m? The mention of trust's i.e. the offshore variety vehicle that does just exactly what it says on the tin! 99.9% percent of the worlds wealth is owned by 0.1% of the worlds population! Just how much money will this family and others like it including the one I work for, lavish amongst themselves when the alleged trust laundering services are complete! There are other things I'd like to say but I fear Mr Moderators axe would fall. Simply the vast majority of their employees could only ever dream of such wealth even a lottery win would not scratch the surface!

  • Comment number 6.

    #4 Gary, Wood has invested £0 thus far. He has scuppered a development that would have given Aberdeen a world-class arts centre. Destroying the PVA scheme means that Wood has cost Aberdeen the £9.5m they had secured. Add to this the money spent on the ignored public consultation and the Halliday Fraser Munro technical appraisal (that "misled" the public, apparently) and currently we're more than £10m worse off - and Wood is yet to spend a red cent of his own money. If this is what you call "investing heavily" then I would question your understanding of the situation.

  • Comment number 7.

    Douglas,

    Quite intrigued by the title you have chosen!

    Does this hint that you and the lovely Isabel dance around the kitchen table of an evening to the most wonderful sounds of the estimable Woody Herman Band??

    We should be told!

    Or does it mean that the Wood man has taken his ball (Union St proposal) and run off with it - in the manner of 'it's ma ball'??.

    Any which way, enjoy the Four Brothers!!

 

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