Royal Dutch Shell plc .com Rotating Header Image

Posts under ‘LNG’

BG Group, Gas-Shipping Pioneer, Trades Final Time Before Merger

Screen Shot 2016-02-11 at 10.35.44

Rakteem Katakey: Bloomberg.com: February 11, 2016

BG Group Plc, pioneer of natural-gas shipping, will trade on stock exchanges for the last time on Friday, 19 years after it was created.

The shares will delist Monday as BG becomes a fully owned unit of Royal Dutch Shell Plc following the industry’s biggest acquisition in more than a decade. The stock has increased ninefold since 1997, when former state monopoly British Gas Plc split its exploration and production arm from retail. Shell gained just 15 percent in the period, while BP Plc declined 4.4 percent.

The BG takeover will catapult Shell into second place among the world’s most valuable public oil companies, behind Exxon Mobil Corp. Shell plans to run BG as a subsidiary initially, merging the two companies over the course of a year, according to two officials with direct knowledge of the matter. BG’s assets, including gas projects from Australia to Kazakhstan, will help the Anglo-Dutch energy giant ride out the oil-price slump.

read more

Shell cancels $14.4 billion bridge credit facility

Screen Shot 2016-02-10 at 16.24.32

Screen Shot 2016-02-11 at 10.16.52

By Ian Walker: Published: Feb 11, 2016

LONDON–Oil major Royal Dutch Shell PLC RDSA said Thursday it has cancelled the 10.07 billion pound ($14.4 billion) bridge credit facility that was agreed last May to pay for its acquisition of BG Group PLC (BG.LN) as it is now able to fund the deal from its own cash resources. The transaction is expected to complete on Feb. 15.

FULL ARTICLE

Royal Dutch Shell plc and BG Group plc merger

Screen Shot 2016-02-06 at 08.47.20By Brett Owens: Forbes.com: 6 Feb 2016

The Royal Dutch Shell plc ADR (RDS.A) and BG Group plc ADR (BRGYY) merger, which looked liked such a win-win for everyone has grown a bit complicated as the deal nears completion. The premium has shrunk, as have the benefits of the merger with prices under $90 a barrel.

However, there are still some takeaways for investors to breathe easier about. First, Shell has never cut or suspended its dividend in 40 years. That includes the late 1980s when oil was at $10. And despite a 56% drop in fourth quarter profits, the firm has reiterated it will maintain its dividend for 2016.

The firm has delayed capital expenditures and cut spending. It plans to slash another 3% of its employees this year after the merger.

The Shell BG merger increases Shell’s reserves by 25% and its output by 20%. More importantly, it makes Shell a well positioned producer of LNG – a segment that is growing internationally as oil declines. The merger takes Shell from third to the second largest public oil producer by capitalization after Exxon.

read more

BG Group in ‘excellent’ shape for Shell’s £35bn takeover

Screen Shot 2016-02-06 at 08.50.03

BG GROUP said it was in “excellent” shape ahead of a £35billion takeover by former rival Shell as it ramped up production and drove down costs in the face of sliding oil prices.

The FTSE 100 oil and gas group reported a surge in output in Australia and Brazil – key growth markets identified by Shell to justify the deal – beating its target to deliver a daily average of 704,000 barrels of oil per day last year, up 16 per cent on the previous year.

Volumes increased by 20 per cent in the fourth quarter.

read more

Shell massively expands natural gas business – just as sector tanks

Screen Shot 2016-02-05 at 21.19.49

Terry Macalister Energy editor: Friday 5 February 2016 13.43 GMT

Shell is about to massively increase its exposure to the liquefied natural gas (LNG) market just as profits in the sector dive, according to new figures from BG.

BG – the former international exploration and production arm of British Gas, which will become part of Shell in 10 days in a $35bn (£24bn) merger – ramped up its LNG shipments by nearly 60% in 2015, only to see earnings from this side of its business plunge by 67%.

read more

BG Group posts profit ahead of Shell takeover

Screen Shot 2016-02-05 at 11.24.57

By Tara Cunningham, Business Reporter: 9:16AM GMT 05 Feb 2016

In its final results ahead of its landmark merger with Shell, BG Group has reported a pre-tax profit of $2.98bn, compared with a $2.3bn loss the previous year.

FTSE 100-listed BG is due to be absorbed into the Anglo-Dutch giant by the middle of the month after its shareholders voted overwhelmingly in favour of a £40bn takeover.

Screen Shot 2016-02-05 at 11.21.44In its last year as standalone company, BG managed to limit the impact from plunging oil prices to a 16pc drop in revenue for the year, racking up sales of $16.2bn.

read more

Shell pushes back investment decision on Canadian LNG project

Screen Shot 2016-02-05 at 11.12.10VANCOUVER | BY JULIE GORDON: 4 FEB 2016

British Columbia’s ambitions to become North America’s next major liquefied natural gas exporter took another hit on Thursday, as Royal Dutch Shell pushed back a final investment decision (FID) on its LNG Canada project to late 2016.

The delay came as Europe’s largest oil company reported its lowest annual income in over a decade and said it would take further steps to cut costs to cope with weak oil prices if needed.

LNG Canada, located on British Columbia’s rugged northern coastline, is one of the frontrunners in a now slowing race to build Canada’s first LNG export terminal. It has already been granted its key environmental permits.

read more

Shell’s Profit Down 56 Percent on Depressed Oil Prices

Screen Shot 2016-01-27 at 16.43.31

Screen Shot 2016-01-14 at 00.11.12Shell’s Profit Down 56 Percent on Depressed Oil Prices

By STANLEY REEDFEB. 4, 2016

LONDON — Royal Dutch Shell became the latest big energy company to file a damage report on the impact of depressed oil prices on Thursday, saying that its adjusted profit fell 56 percent in the fourth quarter of 2015 compared to a year earlier.

Shell said earnings adjusted for inventory changes were $1.8 billion, down sharply from $4.2 billion in the comparable period of 2014.

For 2015, Shell’s earnings fell 80 percent to $3.84 billion, compared to $19 billion in 2014.

read more

Shell Profits Plunge By 80% Amid Oil Slump

Screen Shot 2016-02-04 at 08.00.00

Shell is pressing ahead with a £36bn ($52bn) merger with exploration group BG. It has said 10,000 jobs will go across the two companies as a result. The deal has been approved by shareholders and will complete later this month.

The industry has been hammered by the collapse in the world energy market which has seen the price of a barrel of Brent crude dive by three-quarters from $115 in the summer of 2014 to around $30 at the start of this year.

Mr van Beurden said Shell was seeing “substantial changes”, slashing costs and investment in response to the slump – and warned that more cuts could come.

read more

Did Shell Shareholders Just Seal Their Fate?

Screen Shot 2016-01-30 at 10.17.42

Alex Dumortier: (TMFAleph1): Jan 29, 2016 at 1:08PM

U.S. stocks are higher in early afternoon trading on Friday, with the Dow Jones Industrial Average (DJINDICES:^DJI) and the S&P 500 (SNPINDEX:^GSPC) up 1.76% and 1.72%, respectively, at 1 p.m. EST. Royal Dutch Shell plc’s ADRs (NYSE: RDS-A), up 0.58%, are underperforming the broad market, but are roughly in line with the sector, with the FTSE Global Energy Index up 0.34% at 12:04 p.m. EST.

On Wednesday, shareholders of Royal Dutch Shell overwhelmingly approved the acquisition of BG Group plc, with 83% of votes cast in favor of the mammoth deal. If you ask this columnist, the uncertainty regarding whether it will ultimately produce an acceptable return for shareholders does not warrant that level of support.

read more

Final approval for Shell mega-merger as BG Group shareholders vote in favour of the £36bn deal

Screen Shot 2016-01-29 at 08.01.06

By LAURA CHESTERS FOR THE DAILY MAIL: 29 JAN 2016

One of the largest takeovers in history finally got the go-ahead yesterday after BG Group shareholders followed those at Royal Dutch Shell in approving the £36billion deal.

At a meeting in London, 99.53 per cent of BG shareholders voted in favour, a day after 83 per cent of Shell investors approved the deal that was first announced last April.

Shell chief executive Ben van Beurden said: ‘BG adds attractive deep water and integrated gas positions and will act as a catalyst for accelerating the reshaping of our business. 

read more

Final green light for Shell-BG takeover

Screen Shot 2016-01-28 at 15.04.44

By Jillian Ambrose: 2:19PM GMT 28 Jan 2016

BG Group shareholders have voted through Shell’s £40bn takeover bid by an overwhelming majority.

The widely expected final nod for the landmark energy merger was voted through with 99.55pc of BG investors in favour, ending a controversial nine month campaign by Shell to cement its new strategic direction.

The tie-up received an 83pc approval vote from Shell shareholders on Wednesday, despite early fears that the deal was overpriced due to the collapse of oil prices since the bid was made last April.

read more

Shell gets green light for merger with BG Group to create world’s biggest liquefied gas trader

Screen Shot 2016-01-28 at 09.16.18

By LAURA CHESTERS FOR DAILY MAIL: 28 JAN 2016

Royal Dutch Shell’s mega-merger with gas giant BG Group looked set to be approved yesterday, creating the world’s biggest liquefied gas trader and boosting bankers’ bonuses.

The £35billion deal got the go-ahead from Shell investors yesterday with 83 per cent of those voting backing the deal.

Today BG group will announce the result of its shareholder vote. For the deal to go ahead more than 75 per cent must approve it.

The completion of the deal – expected next month – will see a windfall of £106million of fees for various advisors on the deal including £76million to be shared by top investment banks including Bank of America Merrill Lynch, Goldman Sachs and Rothschild.

read more

Shell/BG vote is a bet on oil prices bouncing back

Screen Shot 2016-01-07 at 22.31.30Screen Shot 2016-01-28 at 08.18.02

Screen Shot 2016-01-13 at 08.05.25By Andy Critchlow January 27, 2016

Shell Chief Executive Ben van Beurden can breathe easier after shareholders backed his big gamble on oil prices rebounding. Only 17 percent of investors voted against his $50 billion takeover of BG Group on Jan. 27. Cost savings estimated at $3.5 billion will help assuage some worries, and paying partly in shares insulates some of the market effect, but the $60 oil Van Buerden says is needed for the deal to create economic value still looks far away.

read more

Will 2016 Be Royal Dutch Shell’s Worst Year Yet?

Screen Shot 2016-01-27 at 21.13.07

There is a lot of pessimism regarding shares of Royal Dutch Shell (NYSE:RDS-A) (NYSE:RDS-B). Despite strong cash flow results behind its less-than-stellar earnings results, shares of Shell have been sinking faster than its Arctic drilling rigs (too soon?).

Over the past 18 months, the company has lost more than half of its market capitalization while its largest peers, ExxonMobil (NYSE:XOM) and Chevron (NYSE:CVX), have seen more modest declines.

Unlike ExxonMobil and Chevron, which are continuing with business as usual with their development plans and slowing capital budgets, Shell is also in the middle of a transformative acquisition that could shape the company’s future for decades. With that added uncertainty of what Shell will look like post BG Group merger, and oil prices in the $30 per barrel range, some investors may be wondering if 2016 will be a rough one to be a shareholder.

read more

Why the Shell-BG mega-deal was risky for the City as well as the oil giants

Screen Shot 2016-01-27 at 21.02.45

By Ashley Armstrong7:17PM GMT 27 Jan 2016

It has taken nearly 10 months, five competition regulators and 40 approvals from other global authorities. But Shell’s chief executive Ben van Beurden’s white-knuckle ride is finally drawing to a close.

On Wedensday, van Beurden won overwhelming support for the £40bn takeover from his shareholders. However, his celebrations may well be drowned out by raucous hedge funds who are cheering what one called “a very profitable trade”.

At Shell’s highly-anticipated shareholder vote in The Hague, the mood was serene, with van Beurden and chairman Charles Holliday warmly greeting shareholders, safe in the knowledge that the level of proxy vote support meant the decision was never in doubt.

read more

Shell Needs to Repay Investors Who Backed Its Biggest Ever Wager

Screen Shot 2016-01-27 at 20.37.29

Screen Shot 2016-01-20 at 08.29.05By Rakteem Katakey: Bloomberg.com: 27 JAN 2016 – 5.06 PM GMT

Royal Dutch Shell Plc is under pressure to reward the faith of the more than 80 percent of shareholders who shrugged off the risks from slumping oil prices to back its record acquisition of BG Group Plc. 

That won’t be easy: the rout in crude has cut the value of Europe’s biggest oil company to the lowest in more than 10 years and raised investor concerns that its dividend is unsustainable.

Chief Executive Officer Ben Van Beurden, who expended a lot of political capital convincing investors that BG will help Shell ride the downturn, has to deliver promised benefits from liquefied natural gas to deepwater oil production as billions of dollars of cash flow is choked off.

read more

Shell Shareholders Approve Acquisition of BG Group

Screen Shot 2016-01-27 at 16.43.31

Screen Shot 2016-01-26 at 08.12.50Shell Shareholders Approve Acquisition of BG Group

By STANLEY REEDJAN. 27, 2016

LONDON — In one of the first major deals struck as oil prices plummeted, Royal Dutch Shell shareholders on Wednesday approved the acquisition of the BG Group, the Britain-based oil and gas producer, for about $50 billion.

Analysts had expected major oil companies like Shell and ExxonMobil to take advantage of low prices to acquire rivals or smaller companies to strengthen their position, but there have been few big moves so far, perhaps because of the steepness of the drop in oil prices, which have fallen since the summer of 2014 to around $30 a barrel from more than $100 dollar a barrel.

read more

Shell shareholders vote in favour of £40bn BG takeover

Screen Shot 2016-01-27 at 14.24.09

By Jillian Ambrose: 12:35PM GMT 27 Jan 2016

Shell shareholders have given the nod to the £40bn takeover of BG Group by a strong majority.

The 83pc vote in favour of the plans paves the way for the creation of Britain’s largest public company, pending a separate vote by BG shareholders on Thursday which is widely expected back the plans.

The vote, at an extraordinary meeting in the Hague, concludes a nine month gauntlet of global regulatory hurdles, since when plunging oil prices have raised serious concerns that Shell’s offer was overpriced.

read more

Shell shareholders approve $50 billion BG takeover

Screen Shot 2016-01-07 at 22.31.30

Screen Shot 2016-01-27 at 14.09.30

Screen Shot 2015-12-23 at 09.03.45THE HAGUE | BY KAROLIN SCHAPSWed Jan 27, 2016 1:56pm GMT

Royal Dutch Shell (RDSa.L) shareholders approved its $50 billion takeover of BG Group (BG.L) on Wednesday, clearing the last main hurdle to creating the biggest liquefied natural gas (LNG) trader in the world.

BG shareholders are also expected to approve one of the biggest deals in the energy sector in the past decade at a meeting on Thursday, a vote that would allow the two oil and gas companies to merge on Feb. 15.

Few investors have openly challenged the deal’s strategic benefits for Shell. But with oil languishing near $30 a barrel and only a slow recovery forecast, some had questioned the viability of a deal that would increase Shell’s debt burden.

read more

Investors brace for BG merger vote

Screen Shot 2016-01-26 at 22.38.09

by Veselin ValchevTuesday, 26 Jan 2016, 08:42 GMT

Royal Dutch Shell Plc (LON:RDSA) shareholders are due to vote on the £31 billion acquisition of smaller energy rival BG Group tomorrow, and all uncertainty in regards to the vote’s success seem to have evaporated.

A slew of highly influential investors and advisers have publicly backed the merger, which opponents have slammed as “value destructive” for Shell shareholders.

The only major investor to publicly come out against the acquisition is Standard Life, which argued that the slumping oil price has eroded the appeal of the merger. However, Standard Life also noted that it would vote for the deal with its BG Group holding at the respective vote on Thursday, the day after Shell votes.

read more

Oil price falls again as Shell shareholders prepare to vote on mega-merger with BG Group

Screen Shot 2016-01-05 at 10.04.42

Screen Shot 2016-01-26 at 08.33.01

The price tumbled as much as 3 per cent during trading yesterday when it emerged Iraq had produced a record high of oil and may even raise output further.

The news comes as the market is already braced for more supply from Iran after sanctions were lifted. 

Tankers have begun to leave Iran’s ports and it agreed its first deal with a European company last week with Greece’s refinery Hellenic Petroleum. 

Some analysts expect Iran to increase production to between 3million and 4million barrels a day. Iraq’s fields produced more than 4.1million barrels a day.

read more

After The Big Short, here’s The Big Long: Shell-BG

Screen Shot 2016-01-26 at 08.13.47

By Nancy Hulgrave: 26 JAN 2016

“The Big Short” landed in UK movie theaters this weekend. The film adaptation of Michael Lewis’ best-selling novel tells the story of Wall Street outsiders who made a fortune predicting the subprime mortgage crisis and subsequent financial crash.

If you watch the film — and you’re not too busy deciding whether it’s Ryan Gosling, Brad Pitt or Christian Bale you wish you were sharing popcorn with (don’t worry boys, you get Margot Robbie in a bubble bath — you’ll probably spend the two-odd hours wondering what the next big short might be and how you can profit.

read more

Does the Shell/BG Group Deal Make Sense With Oil at These Levels?

Screen Shot 2016-01-25 at 21.08.04

On April 8, 2015, Royal Dutch Shell (NYSE:RDS-B) announced the terms of an agreement to buy BG Group for 383 pence in cash (or $5.51 per share) and 0.4454 Shell B Shares. If shareholders of both companies approve the deal when they vote on Jan. 28 and 29, the combined company will become the largest publicly traded LNG producers in the world, with more than double the reserves of ExxonMobil (NYSE:XOM). And it would catapult Shell into becoming the world’s second-largest non-state oil company in the world from a market cap perspective, ahead of Chevron (NYSE:CVX). 

read more

Shareholder green light expected for Shell BG merger

Screen Shot 2016-01-25 at 09.10.00

MARTIN FLANAGAN: Monday 25 January 2016

Major investors are expected to back Shell’s troubled £36 billion takeover of rival BG Group this week despite reservations that the plunging oil price has made the deal less attractive than when first unveiled last year.

David Cumming, head of equities at Edinburgh-based Standard Life Investments, has been one of the most high-profile opponents of the merger, calling it “value destructive for Shell shareholders”.

Some other institutional investors also have concerns about the terms of the deal in the current depressed climate for the oil industry, and it is thought the Shell shareholder vote on Wednesday and BG vote on Thursday could be close.

read more

Fund houses poised to greenlight Shell/ BG takeover

Screen Shot 2016-01-21 at 18.27.32

A raft of fund houses have revealed their hand and come out in favour of the deal, defying critics who argue that the fall in the oil price has made it unworkable for Shell. Kames is understood to be backing the deal with its Shell and BG shares and is understood to be encouraging all its fund managers to vote in line with the house view – contrary to some fund houses which allow the managers of listed trusts to back their clients in company votes rather than toeing the party line.

Rathbone chief investment officer Julian Chillingworth said the fund house would be voting for the deal on behalf of both Shell and BG despite the recent oil price slide. He said: “Our house view is that on balance this deal is good for Shell in the medium term and that it should go ahead,” adding “these assets do not come around too often”.

read more

Shell investors: all they need to know, the crucial documents, and how to vote

Screen Shot 2016-01-17 at 15.30.46

By John Ficenec, Ficenec: 1:26PM GMT 17 Jan 2016

Royal Dutch Shell shareholders have less than two weeks to cast their vote on the proposed takeover of BG Group. We provide all the crucial dates, how to vote, and where the additional information can be found.

How to vote

The most important thing is for retail investors to use their shareholder rights and vote.

Importantly only “Members” of the company who appear on the shareholder register, and personal CREST account holders, have an automatic right to vote. The majority of investors with shares in SIPPs and ISAs will be held through nominee accounts, and as such have no automatic right to vote.

read more

Shell chief stakes his job on bet that oil will bounce back

Screen Shot 2016-01-16 at 23.28.14

Screen Shot 2015-12-23 at 09.03.45SUNDAY 17 JAN 2015

What’s not to like about $30 a barrel?

Quite a lot if you are Ben van Beurden, Royal Dutch Shell’s chief executive, who is trying to land the deal of a lifetime based on oil prices being double what they are now. Van Beurden was hailed last year for a swift raid on BG, a British oil and gas giant that had lost its way. Shell had stalked BG for 15 years but lacked the nerve to make a move. Van Beurden, a surprise choice as boss, had the balls. 

FULL ARTICLE

Shell dividend could be under threat over audacious takeover of gas specialist BG Group

Screen Shot 2016-01-15 at 23.17.06

By LAURA CHESTERS FOR THE DAILY MAIL: 16 JAN 2016

The last time Royal Dutch Shell cut its dividend was in 1945 when the Netherlands had just endured the ‘Hunger winter’ under Nazi occupation before the end of the Second World War.

Now investors are worrying their treasured dividend could be under threat again.

Shell is embarking on an audacious takeover of gas specialist BG Group. The £36bn deal will go to a shareholder vote at the end of the month. However, with the oil price at a 12-year low, many are warning the deal does not make sense.

And worse still, some are fearful that if it does go ahead it will mean Shell won’t be able to afford to keep paying its healthy dividend.

Shell pays the best dividend in the FTSE 100 and yields around 7.2 per cent on the current promised $1.88-a-share dividend. As Steve Clayton, head of equities research at broker Hargreaves Lansdown, explains: ‘Half of Holland would keel over in apoplectic horror if Shell ever cut the payout.’

A handful of institutional investors have already pronounced their views on the deal.

read more

Short-term LNG supply: Shell to lose $1b contract as Qatar offers lower price

Screen Shot 2016-01-14 at 23.16.04

By Zafar BhuttaPublished: January 15, 2016

ISLAMABAD: Energy giant Royal Dutch Shell is going to lose a five-year liquefied natural gas (LNG) supply contract worth over $1 billion as a Qatari company has agreed to provide the commodity at a lower price to Pakistan.

Gunvor and Royal Dutch Shell had won supply contracts in response to the two tenders floated by Pakistan State Oil (PSO) a few weeks ago for bringing 120 LNG cargoes over a period of five years.

Gunvor offered to bring 60 cargoes at 13.37% of Brent crude price whereas Shell quoted 13.8% of Brent crude price for another 60 cargoes.

read more

Shell-BG deal wins more support, but concerns persist

Screen Shot 2016-01-14 at 14.57.20

By Ron Bousso and Karolin Schaps

LONDON, Jan 14 Two weeks before shareholders are due to vote on Royal Dutch Shell $48 billion bid for BG Group, more investors have come out in support of the deal, despite lingering concerns about the effect of falling oil prices on the sector.

The bid has already won the backing of several major shareholders and advisory groups, with only a handful of investors publicly arguing against its merits even as oil prices have dropped below $30 a barrel for the first time in 12 years.

read more

Standard Life to vote for and against Shell & BG merger

Screen Shot 2016-01-12 at 14.00.18

Calling the deal “value destructive for Shell shareholders”, Standard Life announced on Friday that it will vote against, and revealed that it had tried to persuade the Shell board to renegotiate the deal.

by Veselin ValchevTuesday, 12 Jan 2016

Standard Life, a top shareholder in both Royal Dutch Shell Plc (LON:RDSA) and BG Group, will support the deal via its holding in BG, sources close to the company revealed yesterday, after last week the UK fund said it would vote against the deal with its Shell shares.

read more

Top Investor Votes Both Ways On Shell Deal

Screen Shot 2016-01-11 at 22.23.47

By Mark Kleinman, City Editor: 11 JAN 2016

A leading City investor is to vote some of its shares in favour of Shell’s £36bn takeover of BG Group, despite its public opposition to one of the oil industry’s biggest-ever deals.

Sky News has learnt that Standard Life Investments will vote its roughly 1.3% stake in BG in support of the tie-up at an extraordinary shareholder meeting later this month.

The decision will follow a vocal effort by Standard Life Investments’ top fund manager, David Cumming, to encourage Shell to renegotiate the terms of the deal.

read more

Shell’s key shareholder advisory group gives support for BG Group bid as oil giant predicts oil price will double

Screen Shot 2016-01-11 at 15.07.09

By EMILY DAVIES FOR DAILY MAIL: 11 January 2016

Shell’s mega bid for rival BG Group has received crucial backing in the US as the oil giant’s boss predicts the price of oil could double.

Glass Lewis, which gives guidance to US investors, has said it supports the £36billion offer that Royal Dutch Shell made in April last year.

Shell chief executive Ben van Beurden has shunned suggestions the deal is unwise due to sinking oil prices, currently around $33 per barrel, and has predicted prices will double.

He said: ‘The oil prices we are seeing today are not sustainable and are going to settle at higher levels over the next few decades than the low $60s that we require to make this deal a good deal.’

read more

Shell boss bets oil price will double

Screen Shot 2016-01-11 at 14.43.27

Van Beurden told The Sunday Times this weekend he was “very, very confident” it would bounce back.

“The oil prices we are seeing today are not sustainable and are going to settle at higher levels,” he said, “and higher, in my mind, over the next…

FULL ARTICLE

Deal or No Deal? The Numbers That Matter for Shell’s BG Takeover

Screen Shot 2016-01-11 at 10.48.56

Screen Shot 2015-12-23 at 09.03.45…investors have questioned whether Shell is paying too much after oil prices slumped to the lowest in almost 12 years.

By Rakteem Katakey: JAN 11, 2016

Royal Dutch Shell Plc is a month away from completing its biggest acquisition, which would vault it over Chevron Corp. to become the world’s second-biggest non-state oil company.

The takeover of BG Group Plc would raise Shell’s market value close to $175 billion, boost flagging reserves and production, add to cash flow and bolster its ability to pay dividends, the company says. Yet investors have questioned whether Shell is paying too much after oil prices slumped to the lowest in almost 12 years.

read more

Shell upbeat on BG buyout even as oil price falls as shareholder advisory group Glass Lewis is said to be in favour of the deal

Screen Shot 2016-01-05 at 10.04.42

Screen Shot 2016-01-10 at 14.59.18

Screen Shot 2015-12-23 at 09.03.45

But some investors are concerned over the plunging oil price and late last week Standard Life Investments said it would be voting against the deal.

By JON REES, FINANCIAL MAIL ON SUNDAY: 10 JAN 2016

Shell’s £36billion offer for rival BG Group has received a boost after shareholder advisory group Glass Lewis is understood to have come out in favour ahead of the investors’ vote later this month.

Glass Lewis is the leading adviser for US shareholders and nearly a third of Shell’s investors and a quarter of BG’s are US-based. The deal has also won the backing of the other leading shareholder advisory group ISS last week. 

read more

Major Shell investor vows to vote against £40bn BG Group takeover

Screen Shot 2016-01-08 at 21.04.58Standard Life Investments, the 16th largest shareholder in Shell with a 2.1pc stake, has voiced doubts that the oil price will bounce back sufficiently to make the tie-up worthwhile.

Brent crude fell again on Friday to trade at $33.55, having slumped more than 70pc since July 2014. It is believed investors feel the price needs to be around $60-$65 in order to support the deal.

Standard Life Investments also has concerns over BG’s assets in Brazil, which is at risk of heft tax bills in th struggling South American economy.

read more

Shell’s BG Deal Gets Backing of Shareholder Advisory Firm

Screen Shot 2016-01-08 at 11.41.17

By Rakteem Katakey: Jan 8, 2016: Bloomberg.com 

Royal Dutch Shell Plc has won the backing for its takeover of BG Group Plc from a body that advises many of its largest shareholders.

Shell’s biggest ever deal has “compelling strategic rationale” and “significant positive economics to be realized within a relatively short time frame,” Institutional Shareholder Services said in a report dated Thursday. “Support for this transaction is warranted.”

Shell is on the brink of pulling off its biggest acquisition, but oil’s collapse to less than $35 a barrel from about $55 on the day the deal was announced in April has prompted some investors to question whether the company is paying too much. The energy producer has justified the deal by saying it would boost its ability to maintain dividends, make it the world’s largest LNG producer and give it new assets from Australia to Brazil.

read more

Shell Executives Try to Seal Deal for BG

Screen Shot 2015-12-30 at 22.00.45

Screen Shot 2016-01-07 at 22.40.29

Screen Shot 2015-12-23 at 09.03.45By SELINA WILLIAMS: Jan. 7, 2016 3:08 p.m. ET

The cash and shares deal, valued at around $51 billion, is important to both companies. If approved, the merger will give the Anglo-Dutch oil giant a dominant position in the growing liquefied natural-gas market as well as stakes in highly prized oil fields offshore Brazil. BG investors will receive a chunky premium for selling up if the deal goes through.

But the deal has been roiled by further declines in oil prices in recent weeks and turmoil in China’s stock market that has pulled down global equities. Investors are also still worried that Shell is paying too much for BG, which it proposed to buy when crude prices were about $55 a barrel in April—about 40% more than they are now.

read more

Shell sees BG deal working with oil at $50 for two years: sources

Screen Shot 2016-01-07 at 22.31.30

Screen Shot 2016-01-08 at 08.07.24

Screen Shot 2015-12-23 at 09.03.45LONDON | BY RON BOUSSO AND EMILIANO MELLINO: Deals | Thu Jan 7, 2016 1:58pm EST

Royal Dutch Shell has told investors its purchase of BG can work even if oil prices average $50 a barrel for two years, its lowest estimate to date as it seeks to secure shareholder support for the $51 billion deal amid plunging crude markets.

The Anglo-Dutch group is confident investors will back the deal at a Jan. 27 meeting, even though crude prices are languishing near 12 year lows around $32 a barrel and it faces a cut to its credit ratings due to higher debts, sources with knowledge of its meetings with analysts and investors said.

read more

Royal Dutch Shell – Time to Pull the Plug

Screen Shot 2016-01-06 at 23.36.11

Shell is expected to make some of the biggest announcements, as it tries to create a leaner structure following the $70 billion acquisition of BG Group.

In fact, The Hague-based group will look to liquidate $30 billion worth of assets once the megadeal is finalized. Shell is already believed to have sold properties worth around $20 billion during the 2014-2015 timeframe. It’s part of the company’s efforts to strengthen its financial position and earn considerable cash flow for the shareholders in the years to come. Toward this goal, Shell has also announced plans to cut 6,500 jobs (or 7% of its global workforce). 

read more

Screen Shot 2016-01-06 at 23.21.13

Screen Shot 2016-01-06 at 23.22.05

Screen Shot 2016-01-01 at 22.23.26

…already local people are alarmed by intense levels of gas flaring – burning off flammable gas and potentially producing dangerous emissions…

ANDY STOREYJANUARY 6, 2016

Erris, County Mayo, is a long way from Dublin. But events there have huge economic significance for the country as a whole, including the capital city.

Gas is finally flowing through the controversial pipeline in Erris, bringing raw gas ashore from the Corrib field for refining. Shell, the project leader, is bragging about its success. At peak production, it is expected that the field will produce the equivalent of 45,000 barrels of oil per day.

But already local people are alarmed by intense levels of gas flaring – burning off flammable gas and potentially producing dangerous emissions – on New Year’s Eve, confirming many residents in their long held doubts about the safety of the project.

read more

Shell-led joint venture gets key permit for LNG facility in Kitimat, B.C.

Screen Shot 2016-01-06 at 23.19.29

By The Canadian Press in News | January 6th 2016

A Shell-led joint venture company has obtained a key permit to build a liquefied natural gas export facility in northern British Columbia.

LNG Canada is the first in the province to receive a facility permit from the B.C. Oil and Gas Commission. The document outlines the requirements for design, construction and operation of the proposed facility in Kitimat, B.C.

Director of external affairs Susannah Pierce said it’s a crucial development for the project, following environmental approval from federal and provincial authorities last June.

read more

Chris Blackhurst: Shell and BG’s £47 billion merger could really pay dividends

Screen Shot 2016-01-06 at 13.08.40

CHRIS BLACKHURST: 6 JAN 2016

No sooner are we into the new year than the stage is set fair for a classic showdown between City short- and long-termism.

This will be on January 27 and 28 when the shareholders in Shell and BG vote on the companies’ proposed £47 billion merger.

Until recently, and the fall in the oil price, I would have said it was a dead certainty the deal would get the nod.

Ever since 1997 when British Gas divested Centrica and became BG, Shell has thought of combining.

The industrial logic is compelling, the joint savings would be enormous, but Shell never did do much in a hurry.

read more

It’s time to debunk the myths around Shell’s bid for BG Group

Screen Shot 2016-01-06 at 07.47.52

Patrick Hosking: 6 JAN 2016

Screen Shot 2016-01-06 at 07.40.06

Screen Shot 2016-01-06 at 07.43.21

Screen Shot 2016-01-06 at 07.45.04

Screen Shot 2016-01-06 at 07.46.35

FULL ARTICLE

Despite Low Oil Prices, Royal Dutch Shell Is An Attractive Long-Term Investment

Screen Shot 2016-01-06 at 07.24.01

Arie Goren

Summary

In my opinion, at the current price Royal Dutch Shell is an excellent long-term investment, first for the generous dividend yielding 8.2% and second for a significant price appreciation when oil prices recover. In my view, the combination with BG is a smart move by Shell, and the acquisition of BG is expected to grow Shell’s reserves and generate meaningful synergies. The merger will accelerate Shell’s worldwide leading position in LNG and deep water. The worldwide leading position in LNG of the combined company will contribute a substantial growth of the company. Global LNG demand is expected to continue to grow strongly. My calculations demonstrate that even in the case of continued low oil prices, Shell will continue to generate strong cash flow due to a significant increase from downstream. Moreover, Shell has a strong balance sheet and good valuation, and its stock is currently trading below book value.

read more

Shell’s finance chief tries to persuade investors into £36bn BG merger deal despite oil prices plunge

Screen Shot 2016-01-05 at 10.29.46

By LAURA CHESTERS FOR THE DAILY MAIL: 5 JAN 2016

Royal Dutch Shell’s finance boss Simon Henry has just returned from the ski slopes. The first week back after New Year is usually slow as people readjust to the office.

But for Henry and chief executive Ben van Beurden there is no time to waste. The pair are straight into endless rounds of shareholder meetings.

They are trying to convince investors to agree to Anglo-Dutch giant Shell swallowing BG Group in a £36billion deal.

The deadline is the two big shareholder meetings set for January 27 and 28 when investors vote, and it needs 50 per cent of its shareholders to approve the mega-deal. 

read more

Fund management industry’s credibility on show in planned BG-Shell merger

Screen Shot 2015-11-20 at 15.10.39

Screen Shot 2016-01-02 at 16.30.10

Screen Shot 2015-12-23 at 09.03.45By Ian McVeigh: 3:35PM GMT 02 Jan 2016

Shell bid for BG in April last year, after the oil price had halved. It is impossible to say what the price of BG would be without the bid, far lower for sure and most calculations suggest that a premium of around $20bn to $25bn is being paid to the shareholders of BG.

I am not suggesting that the board and management of Shell are thinking “I’ll be gone, you’ll be gone”.

The people at Shell take a more long-term view than those on the trading desks of the banks might take, but when you consider the CFO’s comment not to worry about the price paid, this sounds like a classic case of a deal made using other people’s money to me.

read more

Further doubts over Shell/BG deal

Screen Shot 2015-12-29 at 10.23.55

Screen Shot 2015-12-29 at 10.28.13

Screen Shot 2015-12-23 at 09.03.45…the deal doesn’t make financial sense unless Brent crude is sustained at around $60 a barrel.

By Mark Robinson: 29 December 2015

Midway through December, Chinese anti-trust regulators granted unconditional clearance to the proposed £47bn merger between BG Group

(BG.) Royal Dutch Shell (RDSB). The decision effectively removed the final regulatory hurdle, although the deal is still subject to shareholder approval at meetings that are expected to be convened on 27 and 28 January 2016, respectively.

With anti-trust strictures no longer an issue, you would imagine that final approval would amount to a formality, but some industry analysts have questioned whether the terms of the offer still represent fair value in light of reduced assumptions on energy prices through 2016. Spot prices for Brent crude are down by a third since the proposal was announced back in April, so it’s perhaps understandable that there are gathering reservations about the deal.

read more

%d bloggers like this: