Shares in Royal Dutch Shell (LON:RDSA) have climbed marginally higher in London this morning as the Anglo-Dutch group inked a deal to sell its interest in Canadian Natural Resources. The move comes as the FTSE 100 oil major continues with its disposals in an effort to shore up its balance sheet following its acquisition of BG Group.
As of 08:38 BST, Shell’s share price had added 0.17 percent to 2,582.50p, largely in line with gains in the broader UK market, with the benchmark FTSE 100 index currently standing 0.23 percent higher at 7,584.69 points. The group’s shares have added just under a quarter to their value over the past year, as compared with a near four-percent rise in the Footsie.
Canadian Natural stake sale
Shell announced in a statement this morning that it had entered into an underwriting agreement with Goldman Sachs & Co, RBC Capital Markets, Scotiabank and TD Securities, for the sale of 97,560,975 shares in Canadian Natural, representing its entire interest in the company. The agreement will result in total pre-tax proceeds of about $3.3 billion. The sale is expected to complete tomorrow. Shell noted that proceeds from the sale will contribute to reducing the company’s net debt.
People familiar with the situation told Reuters nearly a year ago that the Anglo-Dutch group had decided to offload the stake in Canadian Natural Resources that it acquired as part of a deal to retreat from Canada’s oil sands.
Analysts on FTSE 100 group
Credit Suisse, which sees Shell as an ‘outperform,’ boosted its price target on Shell from 2,725p to 2,850p last week. According to MarketBeat, the FTSE 100 group currently has a consensus ‘buy’ rating and an average price target of 2,688.09p.
Shell updated investors on its first-quarter performance last month, posting a rise in profits.