Dubai's Sidara said on Monday it was walking away from its plan to buy UK's John Wood Group, opens new tab, citing rising geopolitical risks and uncertainty in the financial market, prompting the British engineering group's shares to plunge 40%, reported Reuters.

 

Wood had rejected Sidara's previous four buyout attempts, citing valuation concerns. 

 

Sidara had previously approached Scotland-based Wood Group with proposals ranging from 205 pence to 230 pence per share with the latest offer valuing Wood Group at about 1.56 billion pounds ($1.99 billion) which it had said would be the group's final offer.

 

Sidara had received a deadline extension twice over June and July to make a final offer for Wood Group.

 

The Dubai firm had until this Friday to make a firm offer or walk away for at least six months.

 

The move comes amid growing concerns that the 10-month war in Gaza between Israel and Hamas could spread in the Middle East, a key growth area for Wood's strategy.

 

Sidara is the second suitor to walk away from Wood in the past 15 months after US-based Apollo Global Management abandoned its 1.7-billion-pound bid for the UK-listed company following five approaches that Wood rejected, said the Reuters report.

 

A major global player, Wood operates in more than 60 countries with the Middle East and Africa contributing about 18% of its total revenue.

 

The British firm said it was confident in its strategic directions and affirmed forecasts for 2024 and next year with expectations for core earnings growth to exceed its medium-term target and significant free cash flow in 2025.