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Lloyds List: Shell LPG sale process gains momentum

Lloyds List: LPG sale process gains momentum

“Shell is about to take a step forward in the oil major’s efforts to sell its liquefied petroleum gas business, writes Tony Gray. The group will soon open a ‘data room’ to allow serious potential bidders access to all the information needed to assess the business’ value.”

Friday July 29, 2005

Shell is about to take a step forward in the oil major’s efforts to sell its liquefied petroleum gas business, writes Tony Gray.

The group will soon open a ‘data room’ to allow serious potential bidders access to all the information needed to assess the business’ value.

Buying candidates will be selected from those which respond positively to a ‘teaser’ document, effectively an executive summary of the operations.

Shell aims to have an offer in place for the marketing and distribution assets of its branded LPG business by the end of this year and finalise the deal next year.

Shell is one of the largest operators in the market, handling 2.9m tonnes of branded LPG a year, a 2% share of the world market.

This is down from the 4m tonnes cited at the time the business was put up for sale last September due to some disposals since then. The LPG business operates in 33 markets globally and now employs 3,500 people.

When the business was put up for sale Shell said it was involved in the shipment of several million tonnes of LPG by sea. Tonnage cover is normally met by either contracts of affreightment and time charters or spot charters, depending on the trading area.

The business produced earnings before interest, tax, depreciation and amortisation of $400m in 2003.

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