A deal of this magnitude has been touted for some time. Indeed, the dramatic drop in Oil over the past 9 months had led to speculation there could be takeover’s in the Oil & Gas sector in general.
interestingly, up until now have been noticeably quiet. This morning’s takeover, on today’s valuations, sees Shell (LONDON:RDSa) offering a 42% premium to the closing price of BG Group (LONDON:BG) last night – arguably given the general issues and in particular the recent profit warnings from BG, this could be seen an expensive. But, upon closer inspection, it has become apparent that BG have long been in the sights of Shell for it vast resources that would provide prefect synergies for Shell’s other businesses around the globe.
But could we also see continued deals through the sector? Similar to 1998, when the Oil price has also experienced a disproportionate move lower, the first take over by BP (LONDON:BP) of Amoco was swiftly followed by Japan’s Nippon Oil company take over of Mitsubishi Oil and then Exxon buying Mobil – creating, up until being recently overtaken by Apple (NASDAQ:AAPL), the largest company is US corporate history.
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