Shell/BG deal could trigger more industry M&A
Royal Dutch Shell's [NYSE:RDS.A] GBP 47.7bn (USD 6.65bn) bid to acquire BG Group [OTCMKTS:BRGYY] could trigger further M&A activity in the sector, reported The Globe and Mail on its website Wednesday (8 April) evening.
In a report focusing on the possibility of a consolidation wave on the heels of the Shell/BG development, Randy Mendy, chief operating officer at Edge Consulting Group, said that entities like Eni in Italy, BP in the UK and Total in France could become either merger partners or targets for takeover.
Les Stelmach, a portfolio manager working with Franklin Bissett Investment Management, said in the report that Irving, Texas-based ExxonMobil, which in 2012 bought Celtic Exploration in Western Canada for USD 2.6bn, could potentially pursue another "intermediate-sized" business. He added that such a move would be more likely than, for instance, a scenario where an entity like Canadian Natural Resources launches a bid to acquire Cenovus.
According to a report from the National Post's website Wednesday evening, Canadian Natural Resources and Suncor Energy happen to be two names that come up a lot when discussing possible buyers in the marketplace. The report, which focused on the potential for deals in Canada due to the Shell/BG transaction, added that Husky Energy has suggested that it is open to seeking out a "transformational" deal of its own. A section of the report citing Evaluate Energy noted that Shell, ExxonMobil, Petronas, BP, Chevron, Eni, PetroChina, Total, Statoil and Lukoil all have the financial wherewithal to pursue acquisitions. Evaluate Energy added in the report that Lukoil is the only company in the list that lacks operations within Canada.
Source The Globe and Mail, National Post