UK-based engineering firm Wood Group is to form a joint venture with Germany’s Siemens to provide integrated rotating equipment services.
The JV will comprise 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, which provides aftermarket gas turbine, steam turbine and generator design, repair and manufacturing services.
The company said the JV is expected to deliver annual net synergies to Wood Group of around US$15 million by year three. It will have about US$1 billion of revenue and about 4500 employees.
Ownership of the JV will be 51% Wood Group and 49% Siemens. Wood Group said it also expects that a further payment of up to approximately US$70 million will be due from the JV to Wood Group.
Completion is subject to regulatory approvals and is expected in Q1 2014.
The divisional CEO of GTS, Mark Dobler, will transfer to and lead the new JV on completion.
Wood Group is an energy services firm employing more than 43,000 people in over 50 countries. The group provides engineering, production support, maintenance management and industrial gas turbine overhaul and repair services to the oil and gas, and power generation industries.