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Royal Dutch Shell receives backing from influential shareholder group for £36bn BG deal

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By City & Finance Reporter for the Daily Mail: 8 JAN 2016

An influential shareholder group is expected to support oil giant Royal Dutch Shell’s £36billion bid for gas specialist BG Group.

Shell needs more than 50 per cent of its investors and 75 per cent of BG’s to give the thumbs up for the deal to go ahead, but the collapse in the price of oil – down more than 70 per cent since summer 2014 – has made the deal difficult.

Shareholders are due to cast their vote on January 27 and 28.

The Institutional Shareholder Services, a investor advisory board, will recommend the deal, according to the Financial Times.

Shell unveiled its bid in April but since then the price of oil continued its decline. Shell insists the deal makes sense in the long term and expects oil to return to $60 or $70 a barrel. 

However, as it fell to below $33 yesterday many shareholders have questioned the deal.

The ISS was not available for comment. Shell shares slipped nearly 3 per cent to 1462p and BG fell nearly 2 per cent to 936.9p.


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