Oil Giant Shells Out On Target

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Royal Dutch Shell has agreed to buy oil and gas exploration company BG Group in a deal valued at £47bn.

BG shareholders will be able to take payment in combination of cash and shares in Shell, which is expected to be worth around £180bn following the takeover.

The move comes after a 20% drop in BG’s share value over the previous year amid uncertainty about the future of North Sea oil reserves and a recent period of slumping oil prices.

Shell has revealed that it plans to return cash to shareholders in a £17bn share buyback in or around 2017.  A buyback is the process by which a company purchases shares it has previously issued.  A private company may look to finance the buyback through cash, distributable profits, the proceeds of a new issue of shares, or alternatively, out of capital.

If you require advice or assistance with a share buyback or corporate restructure, please contact Pauline Rigby, Head of the Corporate & Restructuring Team at Forbes Solicitors.

Pauline Rigby

About Pauline Rigby

Pauline Rigby is Head of the Corporate and Restructuring team at Forbes Solicitors. Pauline’s blogs cover a wide range of corporate issues, specifically areas including company formation, banking, joint ventures and shareholder matters, contractual matters and equity fundraising or investing.
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