Royal Dutch Shell agreed to buy smaller rival BG Group for 47 billion pounds in the first major energy industry merger in more than a decade, closing the gap on market leader Us Exxon Mobil after a plunge in prices.
The companies announced the £47 billion deal early Wednesday. It’s the biggest in the sector since Exxon bought Mobil in 1998, according to Dealogic. If completed, the purchase will add 25% to Shell’s oil and gas reserves and 20% to production.
The third-biggest oil and gas deal ever by enterprise value will bring Shell assets in Brazil, East Africa, Australia, Kazakhstan and Egypt.
“We stay very alert to value propositions, we’re watchful,” Exxon executive Jeff Woodbury said during an analyst call in February. “The real focus here is creating value, and we will pursue only those acquisitions that we think that have ultimate strategic value.”
Full Content: The Wall Street Journal
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