BG Group Share Discussion Threads

[nw99] 24/1/2016 17:28

Shell's bid to acquire BG Group has been given a boost by news from Brazil that a much feared tax hike will be avoided.

[zyzzyva] 23/1/2016 10:42

approximately what oil price is shell using for its 2015 results? shells reports on a current cost basis. looking at the trading updates, what would BGs numbers be on the same basis? BG reports on historical cost basis.
back in april, no one believed the $2.5bn cost cuts were possible. shell subsequently increased the number to $3.5bn, and now claims 10,000 job cuts even though BG only has 5000 employees. precisely where are the 10,000 job cuts coming from? are these really synergies at all, perhaps even porkies? has there ever been a similar cost cutting with a merger, and was it successful?

[zyzzyva] 23/1/2016 10:32

read the FT article at the time the bid was made. it tells you everything you need to know. according to one fund manager the oil price needs to rise to $90 for the deal to make sense. so at $32 oil, there must be massive value destruction.

April 9, 2015 6:43 pm
Oil price holds key to success of Shell takeover



Sometimes one number is all that matters. In the case of the proposed takeover of BG Group by Royal Dutch Shell, that number is the oil price. In short, the success or failure of the blockbuster energy deal hinges on Shell’s long-term oil price …

[badtime] 23/1/2016 10:29

And he's off ...again

[zyzzyva] 23/1/2016 08:23

they know the BG deal will be like Rio Tintos Alcan

[nw99] 23/1/2016 07:06

They will be burned then

[montyhedge] 22/1/2016 20:21

Wow just been reported £2.6 billion worth of Shell shares been shorted.

[nw99] 22/1/2016 12:53

The WTI price will be watched closely by chartists as $30.85 is the Fibonacci retracement resistance level

[nw99] 22/1/2016 11:26

Deal will go through now

[osirisra] 22/1/2016 09:24

Disparity between the BG share price and the RDSB offer is closing day by day. It was over 10% a month ago and is now down below 5%. That has got to tell you that peeps are expecting the votes to go through, surely???

[badtime] 21/1/2016 15:13

Why not ...odds r the deal will go through

[montyhedge] 21/1/2016 08:10

Why, don't forget Shell holders have to vote, not a done deal yet. If off BG goes to 600p.

[nw99] 21/1/2016 08:06

Added more BG

[gymratt] 21/1/2016 06:02

I'm voting 'for'....the deal makes sense over the long term if you're investing for income.
The lower the share price, the more shares are bought within the ISA with the reinvested divi..'win win' situation!

[zyzzyva] 20/1/2016 22:17

badtimes LOL!

[badtime] 20/1/2016 22:13

Enjoy yur hols Mav

[badtime] 20/1/2016 22:12

I think it's been pointed out on another thread that Shell employees a tad more....maybe a few may go there? Perhaps you should ring the company?Why keep spouting the same stuff each day? Are you ill? I'm worried about you ...the number of posts each day about the same stuff doesn't seem normal....seriously do you need help?

[zyzzyva] 20/1/2016 20:38

there is something really strange about this deal. i suspect it is about all the payoffs, people with BG options.

they are so desperate to get the deal away, despite the slumping oil price, so they come up with such massive cost savings. In order to meet this target, have to announce 10,000 job cuts to meet the savings, but the acquired company only has 5000 employees!

[zyzzyva] 20/1/2016 20:35

"sold forward on 10-20 yr contracts and hedged" ???? i thought they were relying on a bounce in energy prices. if the sold forward on 10-20 year contracts they would not benefit from any rise in energy prices.

all very well being a " a powerful integrated gas player" but shell are paying on the bases on $70 oil price. and they are going to sell forward at current prices????

[mavis5] 20/1/2016 20:05

BG not in a mess - its production about to take off.

BG's deep sea assets are valuable but more so are the LNG assets (inc Australia, Egypt). Lots of this will be sold forward on 10-20 yr contracts and hedged.

The newly merged companies will first of all be a powerful integrated gas player.

As I have said, there is industrial logic to the deal.

I'm about to go on hols now having voted FOR the deal with my Shell shares.

Good luck to all whichever way you go.

[zyzzyva] 20/1/2016 19:13

mavis5

IMO BG is a much bigger mess than shell because its an E&P company basically linked to the oil price and with a lot of high cost deep sea assets. on top of that it has got $10bn of net debt. in its Q3 results EBIT slumped 70% and net debts rose by more than $1bn - that was when brent oil averaged $51, it is now half that at $26!

[zyzzyva] 20/1/2016 18:55

whatever way they spin this, i do not believe it. BG only has 5,000 employees (link at bottom). to say they are cutting 10,000 employees and direct contractors must be porkies. i have seen restructurings before, where the cut costs in one place but add them in another. it has to make you wonder how they came up with the $3.5bn cost savings, which is around 33% of BGs cost base.


hxxp://fuelfix.com/blog/2016/01/20/shell-bg-group-job-cuts-will-rise-to-10000-in-2016-as-earnings-drop/#35602101=0

HOUSTON — The layoffs that Royal Dutch Shell and BG Group began last year will increase by a third to 10,000 employees and direct contractors in 2016, as the firms curb operating costs and try to extract synergies from their impending merger.

hxxp://www.bg-group.com/21/about-us/bg-group-at-a-glance/

[zyzzyva] 20/1/2016 18:54

mavis5 thanks interesting

[mavis5] 20/1/2016 17:40

Monty and Zyzzyv please see below from Wall Street Journal today.

WSJ
"Shell is a mess, WSJ's Helen Thomas writes: Its operating cash flows, at ~$30B, barely cover last year’s investment spending let alone the $12B dividend it has pledged to maintain, debt levels are rising, production is falling by ~6%, and its largest projects are not slated to start up until 2017.

It's not hard to see why Shell wants to acquire BG, Thomas adds, as the smaller company reported 2015 production rose 16%, helped by its liquefied natural gas project in Australia and oilfields in Brazil."

Shell very much needs BG and its reserves.

In recent years Shell has a very poor record in replacing reserves (wasting billions) whereas BG has been the star performer in this regard over the last 10 years.

Your real point is that the BG Board managed to negotiate a fair deal for their highly regarded assets, which you do not like.