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Times Online: Shell clinches Canada deal

January 23, 2007
Steve Hawkes
 
Royal Dutch Shell has taken a big step towards winning full control of its business in Canada by tabling a new £3.7 billion bid for the minority shares.

 
The Anglo-Dutch oil group said that the revised offer – up to C$45 a share from C$40 – had won the “unanimous” backing of Shell Canada’s directors.

It now needs the support of half the minority shareholders for the deal to go through.

The group owns a 78 per cent stake in Shell Canada but is desperate to buy out the rest to bolster its reserves.

Analysts claim that Shell Canada gives its parent years of opportunity through projects such as Alberta oil sands, the Mackenzie Delta and Beaufort Sea.

Some argue that Royal Dutch Shell should pay closer to C$50 a share.

Garey Aitken, director of equity research at Bissett Investment Management, told Reuters last week: “It’s hard to put a really precise number on this, but generally, I think where we would come out is more like C$50.”

Royal Dutch Shell shares have underperformed the FTSE 100 by 17.1 per cent in the past year.

Justin Seager, Jupiter Asset Management fund manager, said yesterday that the poor performance meant that the shares were attractively valued.

Royal Dutch Shell now accounts for 6 per cent of Jupiter UK’s Growth Exempt Fund.

 http://business.timesonline.co.uk/article/0,,9072-2561291,00.html

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