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John Wood Group, the FTSE 250 engineering services company, should either move its listing to the US or consider going private, activist investor Sparta Capital Management said on Tuesday.
The call comes a year after the collapse of a £1.7bn takeover approach for Wood from buyout group Apollo. Wood’s shares are at present trading at just over 140p, more than 40 per cent below the 240p-a-share cash bid from Apollo that Wood said materially undervalued the company.
In a letter to Wood’s board, Sparta said it was “frustrated by the continued underperformance of the shares”.
“If the UK public markets are unwilling or unable to engage in Wood’s story, we believe you should undertake a strategic review and actively seek alternative solutions,” it added.
Sparta said there had been successful attempts to move primary listings to more favourable locations, and said the US would “seem a logical potential listing venue”.
It also said there had been an uptick in M&A activity this year and that financing markets “appear to be supportive of public to private transactions”.
Wood declined to comment on the letter. A person close to the company said it was focusing on delivering its three-year strategic plan and that listings in the US had not “been a panacea” for other UK companies that had made the switch.
