Wood Group Prepares Sale of $2.7 Billion Consultancy Unit

(Bloomberg) -- John Wood Group Plc is planning a sale process for its business helping governments and companies assess environmental risks, according to people familiar with the matter. 

The Aberdeen-based consulting and engineering group is working with JPMorgan Chase & Co. and Morgan Stanley to identify potential buyers for the built environment business following a strategic review, the people said. The unit could be valued at about 2 billion pounds ($2.7 billion) in a deal, the people said, asking not to be identified because the information is private. 

Wood Group is expected to provide a further update on the business as early as this week. Deliberations are ongoing, and Wood Group may still opt to pursue other options, the people said. 

Representatives for Wood Group, JPMorgan and Morgan Stanley declined to comment. 

Wood Group said in November that it was reviewing the built environment business, which helps its customers measure environmental risks, improved mobility and sustainable infrastructure. The firm said at the time it would publish a trading update on Jan. 13. It comes as the company seeks to unlock value it feels isn’t reflected in its share price. 

The unit, which sits within Wood Group’s broader consulting division, was expected to generate gross revenue of about $1.3 billion last year, the company said at the time. 

Companies are under pressure from investors to pay more attention to sustainability issues, leading to strong interest for specialist consultancies among both private equity and strategic buyers. 

KKR & Co. agreed to buy sustainability specialist ERM last year, while Jacobs Engineering Group Inc. acquired a majority stake in PA Consulting from Carlyle Group Inc. in 2020 at a valuation of $2.4 billion including debt.

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