UK competition watchdog CMA approved Tuesday the estimated £2.2 billion ($2.9 billion) merger of engineering services companies Wood Group and Amec Foster Wheeler, removing a major barrier towards the expected deal completion in October.
The regulator opened an investigation into the proposed merger in June, due to competition concerns regarding the supply of engineering and construction services and operation and maintenance services in the UK Continental Shelf.
As a remedy, the companies proposed to sell Amec’s UK upstream oil and gas business.
“It’s crucial that competition is maintained in this major UK industry,” said the case decision maker, Kate Collyer. “We have therefore conducted a thorough investigation into this merger, and believe that the sale of Amec Foster Wheeler’s assets will address our concerns and ensure that customers in the North Sea continue to be able to obtain competitive bids.”
The last hurdle for the merger is now to obtain regulatory approval in Mexico, but the companies are confident the deal will close in October, Kallanish Energy learns.
“We have made significant progress marketing Amec Foster Wheeler’s UK upstream oil and gas business to a range of high quality bidders,” said Amec’s CEO, Jon Lewis.