Q2 2015 Deal activity off to an explosive start…..

This morning has seen the announcement of the biggest deal of the year so far. Royal Dutch Shell has announced a GBP 47bn offer for BG Group, the UK-based oil and gas exploration company. Global deal activity finished Q1 strongly, recording figures of over GBP 623bn, down slightly on Q4 2014’s figure of GBP 675bn, but still remaining the strongest first quarter of the year since Q1 2007. Q1’s activity was boosted in the final week of the quarter where over GBP 130bn of deals were announced, including the GBP 10bn takeover of Telefonica UK by Hutchinson 3G, and the GBP 27bn merger of Kraft Foods Group with HJ Heinz.

If successful the Royal Dutch Shell/BG Group deal would the largest takeover of a UK company since the 2006 GBP 11.6bn acquisition of Scottish Power by Spain’s Iberdrola SA, and would be the largest deal in the oil and gas sector since the December 2009 GBP 27.4bn acquisition of the US’s XTO Energy by Exxon Mobile.

Reports on the Royal Dutch Shell/BG Group transaction imply that there is little opposition to the deal from shareholders or regulators so this is one mega deal that doesn’t look likely to imminently implode.

Filed under: gas, M&A, oil, takeover, UK, dealmaking