Shell to offload $2.2 billion Woodside stake

Andrew Cummings
November 14, 2017

Shell's subsidiary, Shell Energy Holdings Australia Ltd (SEHAL), has entered into an underwriting agreement with two investment banks, for the sale of 71.6 million shares in Woodside Petroleum (Woodside).

The company said that represented 64% of its interest in Woodside and 8.5% of the issued capital in Woodside.

Sign up here for free access to 7 articles per month + twice daily business email alerts. Sale proceeds will be used to reduce Shell's net debt, Jessica Uhl, chief financial officer of Shell, said in the statement. However, it swiftly upsized the deal, due to strong investor demand, to also include the remaining shares it owns in Woodside.

Shell shares were up 0.8 percent at 1525 GMT.

Even before Shell set out to sell assets, it was distancing itself from Woodside. Shell sold a 10% stake in Woodside in November 2010 and a further 9.5% stake in June 2014.

The North West Shelf Project, where Shell and Woodside are partners.

After being diluted further because of a decision not to participate in Woodside's dividend reinvestment programme, and what Shell said was a "change in Shell's level of involvement over Woodside's financial and operating policy decisions", management concluded previous year that Shell "no longer [had] significant influence".

The oil major completed its sale of 111.8 million shares for $31.10 to institutional investors in morning trade.

Oil and gas giant Shell is parting ways with Woodside Petroleum after a long relationship as a key shareholder of the Australian company.

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