BG SHELL DEAL

BG SHELL DEAL

Royal Dutch Shell said it had agreed to buy BG group for 47 billion pounds in a bid to close the gap on the world's biggest oil major US ExxonMobil. That said, the deal in itself still needs approval from the shareholders of the two companies and will see BG group shareholders get 383 pence in cash plus 0.4454 shell shares for each BG share.

The deal should generate pre-tax synergies of around 2.5 billion pounds per year; these will result in BG shareholders owning around 19% of the combined group.

“The combination of our two businesses is a powerful one which has the sound strategic logic”, said Andrew Gould chairman of BG group in a conference call.

“BG’s deep waters positions and strengths in exploration, liquefaction and LNG shipping and the market will combine well with shell’s scale, development expertise and financial strength,” he said.

Shell said the deal would boost its proved oil and gas reserves by 25% and gives it better prospects in new projects particularly in Australia LNG and Brazil deep water, it is also planning to increase assets sales to 30 million US dollars between 2016-2018 on the back of the deal.

The deal also represents an opportunity for both firms to cut overlapping costs at a time when the energy sector is vulnerable to low oil prices indeed” shell’s executive said. The deal will cut their current spending on oil and energy exploration by close to half. Shell said it was selling 5.6 billion US dollars worth of assets per year.

 

What's New?The latest

Amber Heard donates $7 million settlement to charity

Amber Heard donates $7 million settlement to charity

Amber Heard’s divorce ordeal might have been painful for Johnny Depp and Amber but it was the complete opposite for two charity organizations that will receive the settlement money. The two organizations that she is sending the donations to are the American Civil Liberties Union, to aid in the…

CONTINUE READING

Are there pitfalls to online banking?

Are there pitfalls to online banking?

With easy access to the internet, anyone can have access to a multitude of things – we can get quick advice or more information of things, buy and sell things online, limitless choice of entertainment and even banking services, all at the tip of your fingers! It is all cyberspace, after all,…

CONTINUE READING

How to become a millionaire?

How to become a millionaire?

We all want to be rich some of us do not aspire to be a millionaire, but simply rich enough so they can live comfortably. And on the other hand you have those whose only goal in life is to become a millionaire, which is okay in case you don’t have any other dreams or aspirations. So if you…

CONTINUE READING