This website uses cookies primarily for visitor analytics. Certain pages will ask you to fill in contact details to receive additional information. On these pages you have the option of having the site log your details for future visits. Indicating you want the site to remember your details will place a cookie on your device. To view our full cookie policy, please click here. You can also view it at any time by going to our Contact Us page.

Shell completes merger with BG Group

18 February 2016

Royal Dutch Shell said on February 16 that it had completed its $70 billion merger with UK-based BG Group. The combination is expected to boost Shell’s proved oil and gas reserves by 25% and increase production up by 20%. Shell said in December that restructuring will be needed to achieve the merger’s expected benefits, including $3.5 billion in previously disclosed pre-tax synergies.

Stock image
Stock image

In a press release announcing the completion of the acquisition, Shell CEO Ben van Beurden said, “This is an important moment for Shell. It significantly boosts our reserves and production and will bring a large injection to our cash flow. We have acquired productive oil and gas projects in Brazil and Australia and other key countries. We will now be able to shape a simpler, leaner, more competitive company, focusing on our core expertise in deep water and LNG.”

The deal, first announced in April, involved BG shareholders receiving 383 pence in cash and 0.4454 Shell B shares per BG share, a 52% premium over the company’s closing price on April 7. The BG Group will now be officially delisted from the London Stock Exchange.

In an article in The Times, van Beurden added: “Over time, I expect the fundamentals of energy supply and demand to reassert themselves and the strategic and economic benefits of the deal to fully deliver for shareholders. The deal reinvigorates Shell and will be a springboard for further transformation.”

Shell expects to cut 2,800 globally across the combined companies as part of the restructuring plan. These cuts are in addition to the company’s previously announced plans to reduce its headcount and contractor positions by 7,500 globally.

Contact Details and Archive...

Print this page | E-mail this page