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Professor Alan J. Cohen, University of Louisiana-Lafayette, USA comments on posting by Paddy Briggs: the possibility of BP Shell merger

Comment in response to…

Former Shell Executive Paddy Briggs comments on the possibility of a BP Shell merger

July 5th, 2007 09:36

Thank you for a thoughtful post.

I worked at Shell in E&P in technical and leadership positions both in the USA and Europe for nearly 30 years. These days I am an invited speaker & consultant (& university professor in the geosciences) in the area of the impeding “great crew change.” Simply stated: There is a buildup of staff at around age 50 in certain exploration and production disciplines. These staff are your mentors, decision makers (or enablers to decision makers) & problem solvers. These are the staff you want to entice to stay longer at Shell, rather than jump ship or retire. A merger of the sort hypothesized here, between upstream RD and upstream BP, may cause great angst to this critical pool of staff. It will need to be handled very delicately, in my opinion. And preservation of employee and retiree benefits will be important as well.

Professor Alan J. Cohen, University of Louisiana-Lafayette, USA

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One Comment

  1. Paddy Briggs says:

    Thank you for your response. I totally agree that the staff implications of a merger are paramount. Both corporations have fine staff – arguably their most valuable assets. Shell was rather cavalier in letting staff go (even very skilled and experienced people in the upstream) on cost grounds some years ago. They paid the price and have been very actively recruiting over the past couple of years or so. One of the benefits of a Shell/BP merger must be a degree of rationalisation throughout the organisation and no doubt a combine Shell/BP would require many fewer staff at all levels than two separate companies.

    As far as pensioners are concerned I certainly agree. I am active in the Shell Pensioner world on various fronts and if a merger does come about I will be fighting hard to protect the interests of the Shell pensioner community here in the UK. Concerns about Pensions are in the forefront of comments about the other current Anglo Dutch corporation merger in the news at the moment (ICI and Akzo). Here is what the FT reported:

    “Pension trustees are insisting on a central role in any takeover talks between the UK chemicals group and Akzo Nobel, the Dutch conglomerate. The demand came yesterday as ICI rejected a takeover proposal from Akzo valued at £7.2bn. A spokesman for ICI’s pension trustees said: “We would have expected to have an early and direct conversation… “