YESTERDAY’S eight per cent increase in Wood’s share price saw the Aberdeen engineering giant’s stock market valuation increase by around £0.3 billion to £4.8bn and sent a clear signal City investors were impressed with its recent performance.

The company’s interim results announcement provided clear indications last year’s £2.2billion blockbuster acquisition of former rival Amec Foster Wheeler is generating big benefits for Wood.

Read more: Wood boss upbeat on outlook for key North Sea oil and gas market

The company now expects to achieve $210 million annual cost synergies, compared with initial estimates of $134m. It has generated revenue synergies worth $400m helped by combining the expertise and customer bases developed by the two firms.

Wood is a much broader based business than it was before the deal, with its dependence on the cyclical oil and gas market reduced.

The acquisition has delivered benefits for Aberdeen. The city has gained jobs following the transfer of some work there and is home to a much bigger business.

Wood looks to be back on a growth path after three years grappling with the impact of the slowdown in the North Sea market triggered by the slump in the oil price between summer 2014 and early 2016.

Ironically, the firm has capitalised on the recent recovery in oil and gas business. This is strengthening amid signs crude has stabilised at $65 per barrel plus.

Other Scottish firms may draw inspiration from Wood’s decision to make a bold expansion move amid challenging times in a core market.