Instant view: Reaction to Shell scrapping dual share structure

Written by on November 15, 2021

November 15, 2021

LONDON (Reuters) – Royal Dutch Shell will scrap its dual share system in favour of a single class of shares to boost shareholder payouts and simplify its structure, it said on Monday.

MARKET REACTION: Shares in Royal Dutch Shell rose 1.8% in early European trade after the announcement.

COMMENTS:

ANALYSTS AT JEFFERIES

“We see merits in the proposed restructuring of Shell’s shares structure and tax residence. Among other benefits, the proposed changes will increase Shell’s ability to buy back shares which was until now constrained by Class B shares liquidity.

“This is an important point ahead of the start of the $7bn buyback programme related to the Permian divestment and in the context of a potential increase in size of the ordinary buyback (from the current $1bn/quarter).”

STEF BLOK, DUTCH ECONOMIC AFFAIRS AND CLIMATE MINISTER.

“We are in a dialogue with the management of Shell over the consequences of this plan for jobs, crucial investment decisions and sustainability.”

ADAM MATTHEWS, CHIEF RESPONSIBLE INVESTMENT OFFICER, CHURCH OF ENGLAND PENSIONS BOARD

“If this decision will enable the company to be more agile in order to execute its transition to net zero, then it should be viewed positively. We would be keen to understand how this will drive a more ambitious transition in line with the steps the company still need to take as we outlined in our statement at Shell’s AGM.”

KWASI KWARTENG, BRITISH BUSINESS MINISTER

“Welcome news Shell is proposing to relocate its Group HQ to the United Kingdom as part of their plans to accelerate the transition to clean energy.”

(Compiled by Reuters markets and commodities teams; Editing by Toby Chopra)


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