Full Title: Shell and Third Point: Spinning (Off) the Sector
Author(s): Maurizio Carulli
Publisher(s): Carbon Tracker Initiative
Publication Date: December 6, 2021
Full Text: Download Resource
Description (excerpt):
Third Point, the US activist hedge fund, has recently proposed a significant change to the corporate structure of Shell, suggesting a demerger into a legacy energy business and a low-carbon business including LNG, renewables, marketing. It also applies a decarbonization angle to its proposal.
This note argues that the existing proposal is unlikely to enhance shareholder value in the long term, to lower the cost of capital or to stimulate more investments in decarbonization. A spin-off of the renewables business, once more developed, deserves consideration.