Oil giant Shell could merge its Dutch and British holding companies as part of an overhaul in the wake of its reserves crisis, it was reported today.
Shell was said to have hired bankers to assess the possibility of a merger – a far more radical move than the unification of the two boards which many analysts had been forecasting.
The company remained tight-lipped on the merger speculation and said in a statement that it was considering a “broad range of structures” and had not ruled anything in.
The Anglo-Dutch group has already pledged to consider changes to its structure, which is currently made up of Royal Dutch, which controls 60%, and Shell Transport and Trading, the UK side controlling the remaining 40%.
These two companies have separate stock exchange listings in Amsterdam and London.
The Financial Times reported today that “informal agreement” had been reached that the group needs to unify its boards. But any formal decision would need the vote of both boards and an agreement at next year’s AGM.
A spokeswoman for the company said: “We are looking at all options. Nothing is ruled out and nothing in. We are considering a very broad range of structures. Amongst other alternatives, forms of unified boards to which a CEO would report are being studied.
“As we have said we will be forthcoming with recommendations to shareholders in November.”
Shell rocked the market in January by announcing that its oil and gas stocks were 20% lower than previously thought. It subsequently downgraded its reserves a further three times.
The crisis claimed the scalps of three senior executives, including chairman Sir Philip Watts and the head of exploration and production Walter van de Vijver.
Last month the group was fined $120m (€97.8m) by the Securities and Exchange Commission after an inquiry found it violated reporting, record-keeping and anti-trust rules.
It said that agreeing to pay the fine did not mean it admitted the SEC findings or that it was free of blame.
In a further move to draw a line under the crisis, Shell has agreed to pay a penalty of £17m (€25.4m) imposed by the UK Financial Services Authority.
Shares rose 5.75p to 395.5p today.