Teaming Up For Better Service
Wood Group, Siemens to partner in creation of global integrated rotating equipment service provider
Wood Group and Siemens AG have entered into an agreement to form a joint venture (JV) consisting of the Maintenance and Power Solutions businesses of Wood Group GTS (excluding its Rolls Wood Group, TransCanada Turbines and Sulzer Wood joint ventures) and Siemens’ TurboCare business unit. The companies expect the JV to be a significant service provider to the global power generation, oil & gas and industrial sectors.
The shareholding of the JV will be split 51% to Wood Group, and 49% to Siemens. Completion is subject to a range of approvals and is expected in the first quarter of 2014.
The companies said the JV will bring together two organizations with complementary strengths, customers and geographic exposure. Wood Group said it expects to net annual synergies of approximately US$15 million by year three, and currently anticipates a further payment of up to US$70 million from the JV.
Wood Group believes the establishment of the JV will improve the future prospects of its gas turbine activities, which have typically delivered stronger performance when differentiated by a relationship with an original equipment manufacturer (OEM). On completion, all Wood Group’s predominantly opex related gas turbine activities will be in joint ventures and will be reported within the Wood Group PSN division
Wood Group provides a range of engineering, production support, maintenance management and industrial gas turbine overhaul and repair services to the oil and gas, and power generation industries worldwide.
Siemens’ Turbocare unit provides aftermarket gas turbine, steam turbine and generator design, repair and manufacturing services.