The Scotsman: Shell 'Braced for Takeover Bid from Oil Rival Total': “an inquiry found it violated reporting, record-keeping and anti-trust rules.” (shellNews.net)
By Louisa Nesbitt, City Staff, PA News
15 August 04
Oil giant Shell is bracing itself for a takeover bid that could come from French rival Total, it was reported today.
Executives at the Anglo-Dutch group were said to have conceded that the company is vulnerable to a predator, according to The Observer.
It is understood that insiders at the oil group fear Total will launch a raid, although there are no indications that board members have spoken about a tie-up.
Although Total is smaller than Shell with a market value of £68 billion against more than £94 billion, it is thought that Total is the only firm capable of gaining regulatory approval for a merger.
It was reported that if the two firms merged, they would be forced to sell assets to comply with competition rules.
A spokeswoman for Shell said the company would not comment on market speculation, while nobody was available from Total.
Last week Shell was tight-lipped about speculation it could merge its Dutch and British holding companies as part of an overhaul following the reserves crisis.
The group has pledged to consider changes to its structure, which is currently made up of Royal Dutch, which controls 60%, and Shell Transport and Trading, the UK side controlling the remaining 40%.
These two companies have separate stock exchange listings in Amsterdam and London.
Shell rocked the market in January by announcing that its oil and gas stocks were 20% lower than previously thought. It subsequently downgraded its reserves a further three times.
The crisis claimed the scalps of three senior executives, including chairman Sir Philip Watts and the head of exploration and production Walter van de Vijver.
The company was fined 120 million US dollars (£65.5 million) by the Securities and Exchange Commission last month after an inquiry found it violated reporting, record-keeping and anti-trust rules.
http://business.scotsman.com/latest.cfm?id=3347626