IT was difficult not to be disappointed on hearing this week that venerable Aberdeen oil services company John Wood Group was opening its books to allow a US private equity player to formulate a firm takeover bid.

Of course, suitor Apollo had been hovering for months around Wood, with a series of unsolicited bid approaches previously rejected by the Scottish company following only “limited” engagement with the private equity outfit.

The detail of Wood’s statement on Monday, in which it revealed its decision to effectively open the door to a takeover by Apollo, was interesting.

The Scottish company’s board made no bones about “feedback” from shareholders having been a key factor in its granting of access to “due diligence materials” to Apollo. At the same time, Wood’s board emphasised its confidence in its "strategic direction and long-term prospects" and hailed 2022 as a "transformative" year.

A longer-term view is important when analysing the raft of bids which have seen so many stock-market-listed Scottish companies succumb to takeover in recent years and decades.

Oftentimes for these companies, as with listed businesses everywhere, takeovers come at a time of share-price weakness. This is only natural, as buyers seek out bargains or at least value.

Sadly, plenty of Scottish quoted companies have over the years found themselves on the receiving end of opportunistic takeover approaches, as is the way of things in the listed arena. While some have been able to ward off such moves, at least for a while, at other times companies built up over many years have been acquired in the blink of an eye at a time of vulnerability brought on by a weakening of the share price.

One problem with being listed on the stock market for the board of any company which might be very confident about its strategy and prefer independence to being acquired is that investors may well be viewing things on a very different time horizon to the directors. Activist investors and arbitrageurs often want things to happen fast to provide them with a return in the very short term, but patience has over years and decades often also been sadly lacking among major mainstream institutional investors.

This is in stark contrast to the situation faced by the board of a Scottish family company, for example, which might be going through a leaner patch when results are not what they were in the past. The family, in such cases, often has plenty of room to take its time and do the right thing for the long term, without outside parties breathing down its neck. Obviously, such room might not be there if a lender is champing at the bit but, generally speaking, there is far less time pressure on the boards of family businesses than those of companies quoted on the stock market, and they can thus pursue their long-term plan unencumbered.

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Time periods are also important when looking at Wood’s share price.

Yes, Wood shares have leapt on the back of news of the Apollo bid moves. However, take a look further back in time and the steep longer-term fall in the share price is clear.

The Apollo bid approach is pitched at 240p-a-share (or around £1.7 billion in total). In 2011 and in 2013, just to look at a couple of high points, Wood shares traded higher than 900p. And they traded close to 900p as recently as January 2017.

It is interesting to observe that, when Wood’s board revealed on March 7 this year that it was “minded to reject” a fourth takeover approach from Apollo, which at 237p-a-share was just 3p-a-share below the fifth proposal now under consideration, it declared: “The board believes this latest proposal continues to undervalue the group.”

Of course, as previously mentioned, Wood is just the latest of many major Scottish companies to have become a takeover target.

In 2021, temporary power group Aggreko was acquired by private equity players. Albion Acquisitions, a vehicle formed by TDR Capital IV and investment funds advised by I Squared Capital, paid £2.3bn for Aggreko.

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Scotland has also lost its big bank head offices. NatWest, formerly known as Royal Bank of Scotland, is now run from London, with chief executive Alison Rose based in the UK capital. Bank of Scotland merged in 2001 with Halifax to form HBOS, with the enlarged entity based in Edinburgh. However, HBOS was swallowed up by Lloyds in a rescue takeover as the global financial crisis took hold nearly a decade-and-a-half ago.

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Many big Scottish corporate names of the past, from Kwik-Fit to Stakis to Scottish & Newcastle, no longer feature on the stock market as a result of a slew of takeovers.

Returning to time horizons, it is worth emphasising that for private equity players these tend to be relatively short.

Often, deals are highly leveraged and involve significant cost-cutting.

Of course, only time will tell whether Apollo succeeds in its efforts to acquire Wood and, if so, what approach the US player will take.

Wood made a point on Monday of saying that Apollo had declared that it valued the Scottish company’s employees.

The oil services group employs more than 35,000 people around the world, including a large number working in Aberdeen and the North Sea.

Wood, which describes itself as “one of the world’s leading consulting and engineering companies operating across energy and materials markets”, told the London Stock Exchange: “Apollo has stated to the board that it values the skills and capabilities of Wood’s employees.”

While better than nothing, those warm words should not be seen as any kind of guarantee on jobs. There is no specific commitment, just a general statement.

And you would hope that any suitor would value the “skills and capabilities” of the employees of the company it was attempting to acquire, given it is essentially those people who are the business.

In any case, a takeover of Wood would add to a string of miserable news for Scotland in the context of the nation’s huge loss of stock-market-listed companies and major headquarters in recent years and decades.