Standard Life, a major investor in Royal Dutch Shell, says it will vote against the oil major’s proposed takeover of BG Group when Shell shareholders meet on January 27 and 28.
The investment fund, which holds a 1.7% stake in Shell, says the merger does not work at current oil prices and would only be viable with crude prices of over $60 per barrel, rather than the current $33, the BBC reports.
“It’s just the deal we don’t like. We have to put financial logic above management loyalty in this instance, and we would recommend other shareholders do the same,” David Cumming, head of equities at Standard Life, told the BBC’s Today programme, adding he would not want to see Shell’s chief executive Ben van Beurden (pictured) ousted if the deal fails.
Shell said the company has “the broad base of shareholder support” needed to complete the deal, which will see the company become the world’s largest LNG trader.
Both Institutional Shareholder Services (ISS) and Glass Lewis, two influential advisory firms, recommended on Friday that Shell shareholders support the deal.