Royal Dutch Shell announced that it would sell almost a third of its interest in Woodside Petroleum for about $3.3 billion, nine years after it failed to take over the company. Shell, an British-Dutch company based in The Hague, said UBS had agreed to underwrite the sale of 29 percent of its stake in Woodside, selling more than 78 million shares at 42.23 Australian dollars ($42.64) a piece. After the sale, Shell will own nearly a quarter of Woodside, shares that it has agreed to keep in lock-up for at least a year.
Shell’s recent portfolio progress in Australia is aimed at a worldwide push to simplify the company and to improve its capital efficiency, focus investments in Australia through direct interests in assets and joint ventures, rather than indirect stakes.
In a another move to invest more directly, Shell and PetroChina together bought Arrow Energy’s Australian assets in March for 3.5 billion dollars. Shell hinted that another deal for Woodside might be in the works, saying that the lock-up would not apply under certain conditions to “a strategic third party” interested in a more than 3% stake. Woodside, based in Perth, is the largest independent energy company in Australia.
In September, The Australian business daily reported that Shell and BHP Billiton were in discussions last year for a takeover of Woodside, but an offer never materialized, and Shell later denied any plans for a takeover. Now that the Potash Corporation deal is on the rocks, BHP may try its luck closer to home.
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