Royal Dutch Shell Plc  .com Rotating Header Image

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.

UK investors that hold Shell shares in their own name can complete the proxy voting form and mail it to the registrar Equiniti. Votes can also be registered online through www.sharevote.co.uk.

For the majority of UK investors that hold shares through a nominee account, it is essential to contact your broker and either instruct them how to vote on your behalf, or if this is not possible ensure the broker transfers the voting rights on the shares ahead of the meeting.

The Shell general meeting will take place at The Hague in the Netherlands on January 27, so unless investors are planning on appearing in person, all votes must be received by January 25. For the deal to complete a simple majority of 50pc plus one is needed.

The shareholder advice number is 0800 169 1679, and all necessary forms are online.

What is happening?

Shell announced that BG Group had accepted a takeover offer on April 8 last year. The key numbers are that Shell is buying BG with about 40pc in cash and 60pc in Shell shares, or 0.4454 Shell B shares and 383p in cash for every BG share. At current prices that values BG at around £36bn.

Shell’s shareholders are the ones that will be paying for the majority of BG Group. They will see their holding diluted. Instead of owning 100pc of Shell, they will now hold about 81pc in the new company and the old BG shareholders 19pc.

Shell has pledged to maintain dividend payments at $1.88 (£1.30) per share this year and at least that level next year. That would mean a prospective dividend yield at about 8pc.

Shell has said it believes combining the two groups will save $3.5bn a year by 2018. Management is planning to sell $30bn in assets, slash $7bn in costs, $8bn in investment and 10,300 jobs if the deal is approved.

Why is it happening?

Shell needs to replenish its oil and gas reserves so it can continue to pay dividends.

The deal will add some 25pc to its oil and gas reserves. The prime assets that come with BG are deep water oil off the coast of Brazil, gas off the coast of Egypt, and a large new Australian gas development.

Management have said that if the oil price rises to more than $50 per barrel the new combined group will generate more cash, and if the oil price rises above $65 by 2017 it will improve the earnings per share.

The deal as a whole breaks even if oil recovers to above $60 per barrel.

The oil price is currently below $30 per barrel.

SOURCE

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Comment Rules

  • Please show respect to the opinions of others no matter how seemingly far-fetched.
  • Abusive, foul language, and/or divisive comments may be deleted without notice.
  • Each blog member is allowed limited comments, as displayed above the comment box.
  • Comments must be limited to the number of words displayed above the comment box.
  • Please limit one comment after any comment posted per post.