Royal Dutch Shell decides to retain LPG unit |
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Published
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Mon, 20 Mar 2006 02:05
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LONDON - Royal Dutch Shell PLC has decided to retain its global Liquefied Petroleum Gas (LPG) division after considering the unsolicited interest from a possible buyer in 2004. Shell had announced that it was considering its options in September 2004 after the approach.
The Anglo-Dutch giant said it "had completed the review of its global LPG marketing and distribution business and had taken the decision to retain this business within its downstream portfolio." The company said it had already parted with its parts of its LPG business in Portugal, Brazil, Paraguay and Italy for a collective value of about $350 million.
"We would only sell if the values and terms of the sale would offer greater value than we would assign to these assets ourselves," said Ron Blakely, an executive vice president at Shell. "Having fully tested the market, we have concluded that there is better value for Shell shareholders in retaining these profitable businesses.
This is a financial decision, and not a change in strategy." But analysts contend that the troubles at Shell's LPG business were compounded by the declining value of the product. "It's just another example of them failing to execute," one analyst who requested anonymity was quoted as telling by Reuters. Apparently investors also felt the same since Shell shares fell by 0.8 percent to 1,836 pence on the LSE.
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