Could Shell-BG Deal Revive Exxon-BP Merger?
By: MICHEAL KAUFMAN: Published: Apr 9, 2015 at 8:05 am EST
Royal Dutch Shell plc (ADR) (NYSE:RDS.A) has announced an agreement to acquire UK-based BG Group plc (ADR) (OTCMKTS:BRGYY) in a massive $70 billion deal. It is one of the biggest merger and acquisition deals in the oil sector for over a decade, and could become the platform for Shell to compete with market leader ExxonMobil Corporation (NYSE:XOM).
Shell will use cash and shares to pay UK natural gas giant’s shareholders around $20.17 (1,350 pence) per share of BG. Compared to BG’s 90-day average stock price before the deal was announced, it implies that Shell has agreed to pay a 52% premium.
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