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Shell to shed 2,800 jobs after buying BG

Monday, 14 December 2015 3:39 PM [ Last Update: Monday, 14 December 2015 3:39 PM ]

Shell plans to cut thousands of jobs as a result of a planned mega merger with gas giant BG.

Thousands of employees of the Royal Dutch Shell energy group will soon lose their jobs as a result of a planned mega merger with gas major BG.

Shell announced on Monday that it plans to cut about 2,800 roles globally as soon as the merger with BG goes through.

The new job cuts are also in addition to previously announced plans to reduce Shell's headcount and contractor positions by 7,500 worldwide.

The announcement followed a green light by the Chinese government to go ahead with the acquisition of BG that has already been described as the biggest in a decade.

Approval from Chinese authorities was complicated by the fact that the combined Shell-BG group will be the largest supplier of liquefied natural gas (LNG) to China after the merger.

The clearance from China was the final regulatory clearance required for the merger. Other pre-conditional clearances have already been received from the authorities in Australia, Brazil and the European Union.

Shell and BG will now send a merger prospectus to their shareholders and hold special general meetings for votes on the deal. If approved, it will face a court hearing 10 days later and could be completed by early February.

Some shareholders, however, have voiced concern over the merits of the acquisition following the sharp slide in oil prices. The fall in Shell's share price since April means the value of the deal has fallen to $53 billion from $70 billion.

The combination will transform Shell into the world's top liquefied natural gas (LNG) trader and a major offshore oil producer focused on Brazil's rapidly-developing sub-salt oil basin that would rival Exxon Mobil's position as the world's biggest international oil company.

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