Activist investor Daniel Loeb's company, Third Point, has invested several hundred million dollars in hydrocarbon giant Royal Dutch Shell and is calling for its split into several companies due to a strategy it sees as inconsistent.
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In a letter sent Wednesday to his investors and consulted by AFP, Daniel Loeb explains having bought Shell shares during the second and third quarters. According to
the Financial Times
, which quotes sources familiar with the matter, the investment amounts to nearly 750 million dollars for a group which is worth around 190 billion dollars on the stock market. Daniel Loeb argues that the group has
"too many shareholders pushing it in too many directions
.
"
“Some shareholders want Shell to invest heavily in renewable energies. Others want the group to prioritize return on capital and take advantage of its historic oil and gas operations, ”he
notes
,
for example.
Management's strategy, which has so far reacted by trying to respond to various demands, has become
"inconsistent"
and
"contradictory"
.
According to Daniel Loeb, Shell should change its structure, for example by creating two companies: one bringing together the historical activities of the exploration-production, refining and chemicals group which would give priority to the return on capital, and the another grouping together, among other things, liquefied natural gas and renewable energies which would invest heavily in alternative energies.
Engaged discussions
Daniel Loeb says he has initiated discussions with the company. Shell, which is due to release its quarterly results on Thursday, in a statement confirmed that it has started preliminary conversations with Third Point. The group, it is added,
“regularly examines and assesses its strategy”
and
“is open to dialogue with all shareholders”
.
The question of the strategy of oil groups in a world facing climate change has become a recurring issue during their general meetings this year.
The small investment company Engine No. 1 thus succeeded in the spring in having three of its candidates elected to the board of directors of ExxonMobil, which had until then managed to reject almost all the resolutions tabled at its general meeting by activists alarmed by climate change.
