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Coming out of its Shell

When the going gets tough, the tough get going. At a time when crude oil prices have crashed by over 50%, Royal Dutch Shell, Europe’s largest oil explorer by market value, has taken the axiom to heart by buying out BG Group, the UK’s third-largest energy producer, for about £47 billion ($70 billion) — a near 50% premium on BG’s last traded price. This deal — the biggest oil and gas M&A in a decade — will create an entity worth over $296 billion in value, which will emerge as the largest LNG producer among international oil companies. It would be interesting to see if BG, as part of the new entity, now goes ahead with the proposed $9-billion write-down of oil and gas assets that it had indicated prior to the deal.


One way or the other

After an unsuccessful investment in oil, Russian tycoon Mikhail Fridman is now set to pour in $16 billion into telecom businesses in Europe and the US. The switch to telecom comes weeks after Fridman’s spat with the British government, which suspected his LetterOne Energy to be a front for Russian prez Vladimir Putin. Fridman then gave up the dozen North Sea fields he had bought and set up LetterOne Technology, which will pick up traditional telecoms who may need money, along with companies that make apps. It remains to be seen if Fridman can pull this off without ruffling a few British feathers.


Lock, stock & parcel

It seems to be the season of M&As. The US-based FedEx Corp is buying out Dutch rival logistics company TNT Express in order to expand its reach in the European business parcel market. FedEx is paying €8 in cash per share, a premium of 33% to TNT’s last traded share price of €6, thus valuing it at €4.4 billion ($4.8 billion). For a struggling TNT, the buyout couldn’t have come at a more opportune time but for FedEx, a strong dollar would mean TNT’s earnings in euros will keep denting its bottomline.


Carismatic

The ruler of Dubai — Sheikh Mohammed bin Rashid Al Maktoum — is all set to build a home in London for his fleet of 114 luxury cars. The Sheikh, one of the richest men in the world, has secured permission to build the six-storey car park as well as a five-star accommodation for his chauffeurs and staff in the metropolis. The car park will be built next to Battersea heliport by the Thames, allowing him quick access to the city by helicopter. Now that’s a solution for the city’s parking crisis.

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