Join our crew and become one of the 110,559 members that receive our newsletter.

Shell’s $70 Billion BG Acquisition Clears Brazil Hurdle

Shell’s $70 Billion BG Acquisition Clears Brazil Hurdle

Bloomberg
Total Views: 19
July 8, 2015

BG Group’s Cidade de Ilhabela floating production, storage and offloading (FPSO) vessel, the second unit deployed on the Sapinhoá field and the fifth FPSO to come onstream with BG Group as partner in the pre-salt Santos Basin, offshore Brazil. Photo: BG Group

 

By Katerina Petroff

(Bloomberg) — Royal Dutch Shell Plc obtained regulatory approval from Brazil to buy BG Group Plc, clearing another antitrust hurdle to completing the $70 billion acquisition.

Cade, as the regulator is known, published a decision approving the deal without restrictions in Brazil’s official gazette Wednesday. The transaction won’t undermine competitiveness in Brazil’s oil and gas market as other producers would have a higher market share than the combined company, Cade concluded, citing data by oil regulator ANP.

Brazil follows the U.S. in approving the industry’s biggest deal in at least a decade. Shell’s purchase at a 50 percent premium, announced in April, gives the Anglo-Dutch company liquefied natural gas assets in Australia and oil and gas fields in Kazakhstan and Brazil. It still needs approval from countries including China.

In Brazil, Shell owns stakes in offshore fields in partnership with state-controlled Petroleo Brasileiro SA, which is selling assets to reduce the industry’s heaviest debt load.

After announcing the deal, Shell Chief Executive Officer Ben Van Beurden traveled to Brazil to meet with President Dilma Rousseff, reiterating his commitment to the country and interest in new opportunities.

Brazil is set to account for 20 percent of Hague-based Shell’s output by the end of the decade, with BG’s Brazil portfolio seen by analysts including Jefferies as a key growth driver.

©2015 Bloomberg News

Unlock Exclusive Insights Today!

Join the gCaptain Club for curated content, insider opinions, and vibrant community discussions.

Sign Up
Back to Main
polygon icon polygon icon

Why Join the gCaptain Club?

Access exclusive insights, engage in vibrant discussions, and gain perspectives from our CEO.

Sign Up
close

JOIN OUR CREW

Maritime and offshore news trusted by our 110,559 members delivered daily straight to your inbox.