Shell Purchases Britain’s BG Group in $70 Billion Deal
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Royal Dutch Shell(LONDON) — Royal Dutch Shell is buying Britain’s BG Group in a merger worth $70 billion, creating the second-largest energy company in the world, behind ExxonMobil in terms of value.
Shell chairman Jorma Ollila said he believes the merger is in the best interests of both companies and their shareholders.
“This is an important transaction for Shell, accelerating the delivery of our strategy for shareholders. The result will be a more competitive, stronger company for both sets of shareholders in today’s volatile oil price world,” Ollila said in a company statement announcing the merger.
Top officials at Shell say they hope the combined portfolio will add to Shell’s financial growth strategy, particularly in deep water and liquified natural gas. Merging with BG Group will add about 25 percent to Shell’s proved oil and gas reserves and 20 percent to production, each on a 2014 basis.
The transaction would be the largest energy industry merger in over a decade.
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