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Inquest on BG Group/Shell merger

Even the remuneration committee’s ethics were questionable as they acted with impunity by awarding obscene annual bonuses to executives, despite multiple fatalities at operational locations.

By John Donovan

Further comments have been posted overnight on our Shell Blog in an ongoing discussion about Shell’s controversial takeover of the BG Group. To my certain knowledge Shell had its eyes set on British Gas back to at least the mid 1990’s. An important meeting I had in July 1995 with the then Chairman and Chief Executive of Shell UK Limited Dr Chris Fay was interrupted by matters relating to British Gas. A takeover bid was being actively considered. It was not until Ben van Beurden became Shell’s CEO that anyone at Shell had the guts to take a gamble. And it is a gamble. Oil prices are on the brink of a possible and even likely collapse. BTW, I very much agree with the comments made by “regular browser” about Shell’s claimed business principles.

SHELL BLOG OVERNIGHT POSTINGS 

Hello Haterz: 2017/05/04 at 8:13 pm

The results just in show how wrong the press and common opinion was. The acquisition of BG was a perfect match for the Shell Portfolio and BvB plan for the post merger company change is reaping rewards as RDS profits settle back into the ‘normal’ levels. The dividend is once more not under threat. I wonder what the haters will go back to moving about now? #benrocks

BonusGroup: 2017/05/04 at 8:13 pm

Hi Hello Haterz, it was predestined that Shell would buy BG Group. That is why Frank Chapman set-up BG Group like a mini-Shell, copying processes and ensuring asset fit between the two companies. Who would you have sold BG Group to when you retired? This did not happen over night it took years of manouevering. It was not of BvB’s making, all he did was fire the starting pistol for the process to begin.

BogusGroup: 2017/05/04 at 8:58 pm

No need for an apology BonusGroup, glad to see others dragging the skeletons from the closet. Unfortunately many of Chapman’s “disciples” have evaded the accountability noose (so far) and continue to contribute little to industry. Even the remuneration committee’s ethics were questionable as they acted with impunity by awarding obscene annual bonuses to executives, despite multiple fatalities at operational locations. Life may have been a continuous garden party for some, sadly others were not so lucky.

Chapman sits on the board of Rolls-Royce, ironically chairman of the Safety and Ethics committee.

regular browser: 2017/05/04 at 10:05 pm

Perhaps you should look again at the results Hello Haterz all of the profit has been in the Downstream which is to be expected in a low price environment where raw materials are low. The Upstream earnings are abysmal considering the deal was predicated on buying plum BG assets. The results have also come off the back of stripping the combined company of assets and staff so we will see how sustainable they are moving forward, especially when the balance sheet cannot be massaged by creative accounting and when there are reserve write downs and asset repricing based on BG Groups poor cost control and project management. M&A can only be judged over the long term not in one quarters results so I would be cautious about gloating too soon. I hope that you are proved correct and over the long term the hefty price tag was worth it but make no mistake the jury is still out and thats even without accounting for all of the troubles in the courts the company is facing. Contrary to your trolling I would also say that most people on this site desire the company to succeed and only ask that the company live up to its own principles which would ensure long term profitability, BP showed what happened when you put short term gain ahead of sustainability.

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