Anglo-Dutch oil giant Shell has said thousands more jobs will be slashed, if the takeover of British utility company BG can be finalized as planned. The firm said the move was necessary to save costs in the years ahead.
Royal Dutch Shell said Monday it expected to cut 2,800 more jobs globally to save costs, if its takeover of BG Group went through as planned, following a final green light for the merger from China.
Approvals for the takeover had already been given earlier by Australia, Brazil and the European Union.
The job cuts in question would come on top of 7,500 positions already up for slashing in a bid to streamline operations and make them more cost-efficient.
Oil price a headache
Shell said post-merger synergy effects would justify the move, with the measure also being attributed to the continuing fall in oil prices, which had some investors casting doubt on the planned merger.
“The deal doesn’t make financial sense at the current oil price,” Standard Life Investments’ David Cumming said in a statement. “You have got to be pretty bullish on the current oil price to make this deal work.”
The drop in Shell’s share price since April when the planned merger was first announced means that the value of the deal has fallen from $70 billion (63.7 billion euros) to $53 billion euros.
The combination of Shell and BG would transform the Anglo-Dutch energy giant into the world’s trader in liquefied natural gas (LNG).
hg/uhe (Reuters, dpa)