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Shell’s Woodside stake sale on cards as oil prices rally


BRIDGET CARTERMergers & Acquisitions Editor Sydney: December 5, 2016

Following Archer Daniels Midland’s sale of its GrainCorp stake on Friday, the next big block trade to watch out for is a $3 billion-odd sale by Shell out of Woodside Petroleum.

Shell has an interest of close to 14 per cent in the business, and the oil price rally last week that triggered a run on Woodside’s shares has many watching the situation.

In 2014, Shell sold a 19 per cent interest in Woodside for $41.35 per share through Citi and Goldman Sachs, and four years earlier, it offloaded a 10 per cent stake at $42.23 in a deal underwritten by UBS.

On Friday the shares price was $30.94.

Last week’s block trade of ADM’s 19.9 per cent stake in GrainCorp was handled by Lazard. The stock was sold to UBS at a 2.1 per cent discount to the company’s last share price. It was higher than in July when the company rejected offers for the stake at $350 million.

And while it was expected ADM would sell out of GrainCorp before it reported its results last month, the timing was said to be opportunistic on the back of a rally in the stock last week. It is understood there had been no approaches for the strategic stake between July and last week.

GrainCorp’s share price was trading between $8 and $9 in 2012 when ADM amassed shares in the business as part of its attempts to embark on a $3bn takeover.

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