Shell Names China Boss To Key BG Merger Post
The head of Royal Dutch Shell (Xetra: R6C1.DE - news) 's operations in China is to spearhead the oil major's integration with BG Group (LSE: BG.L - news) as the industry's biggest-ever takeover inches forward.
Sky News understands that Shell (LSE: RDSB.L - news) informed senior managers this week that it was naming Huibert Vigeveno, its executive chairman for China, as executive vice-president for integration, with the appointment due to take effect at the beginning of August.
The role being handed to Mr Vigeveno, a long-serving Shell executive, will be a crucial one.
Shell's cash-and-shares takeover of BG, which was worth £47bn when the deal was unveiled in April, is not due to complete until next year.
The Anglo-Dutch group has made filings seeking approval for the transaction in a number of countries around the world.
Reporting to Simon Henry, Shell's chief financial officer, Mr Vigeveno is likely to play an important role in determining the fate of hundreds of BG employees, with analysts predicting that many of their jobs are likely to disappear once the deal completes.
Shell has set a target of saving $2.5bn (£1.6bn) annually from 2018 by combining the two companies, with financial calculations predicated upon a recovery in Brent oil prices from the current depressed level to $75-a-barrel by 2017 and $90-a-barrel between 2018 and 2020.
The takeover will strengthen Shell's position in liquefied natural gas (LNG), and bolster its proven oil and gas reserves by 25%.
Some analysts expect China's Ministry of Commerce to seek additional concessions as a condition for approving the deal, which could potentially involve the disposal of some LNG assets.
Shell, which declined to comment further on Mr Vigeveno's appointment, has also said that it expects to make up to $30bn-worth of asset sales during the two years following the takeover.
