Shell share price: Group and Dutch pension fund explore Eneco bid

Royal Dutch Shell (LON:RDSA) has teamed up with a Dutch pension fund for a potential joint acquisition of sustainable energy provider Eneco, the blue-chip energy major has said. The move comes after last month, the Anglo-Dutch group unveiled short-term targets as part of its long-term ambition to reduce the net carbon footprint of its energy products.

Shell’s share price has climbed higher in today’s session, having added 0.51 percent to 2,357.00p as of 08:51 GMT. The advance is largely in line with gains in the broader UK market, with the benchmark FTSE 100 index currently standing 0.47 percent higher at 6,887.23 points. The group’s shares have lost about 8.5 percent of their value over the past year, as compared with about an 11.8-percent dip in the Footsie.

Possible Eneco bid

Shell announced in a statement yesterday that it had joined forces with PGGM, a cooperative Dutch pension fund service provider, to explore the opportunity to participate in the controlled auction for the sustainable energy provider Eneco. The move comes after last month, the sustainable energy company and its shareholders’ committee announced the start of the privatisation process.

“With their roots in Dutch society, both PGGM and Shell understand Eneco’s unique position in taking on the challenges and opportunities of the energy transition,” the FTSE 100 group said in a statement, adding that the consortium envisaged “that Eneco will be a platform for growth, operating from Rotterdam, with potential investments inside and outside of the Netherlands”.

Reuters noted in its coverage of the news that analysts estimate Eneco to be worth about €3 billion.

Analysts on Shell

HSBC, which rates Shell as a ‘hold,’ lowered its price target on the shares from 2,840p to 2,640p yesterday, while last week, Barclays, which is ‘overweight’ on the blue-chip group, trimmed its valuation on the shares from 3,300p to 3,250p. According to MarketBeat, the FTSE 100 company currently has a consensus ‘buy’ rating and an average price target of 2,926.33p.

As of 09:02 GMT, Tuesday, 15 January, Royal Dutch Shell Plc ‘A’ share price is 2,357.00p.