Shell: slick move angers Dutch

Back to the City: ‘trebles all round’

(Image credit: Nathan Stirk/Getty Images)

published 18 November 2021

“Vaarwell Shell”, or should that be “welcome home to a dear old friend”? News that the oil giant is leaving The Hague – and axing the “Royal Dutch” part of its name – to become 100% British has “gone down like a plate of mouldy pannenkoeken in the Netherlands”, said Ben Marlow in The Daily Telegraph. The decision to unify the company’s domicile in London means severing ties dating back to the formation of Royal Dutch Petroleum in the late 1800s. The Dutch government declared itself “unpleasantly surprised”. In the City, by contrast, it was “trebles all round”. Shell’s move to follow fellow big Anglo-Dutchers RELX (formerly Reed Elsevier) and Unilever back to Blighty is a huge post-Brexit vote of confidence.

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The Dutch government, which is reportedly scrambling to reverse the decision, “has only itself to blame”, said Ian King on Sky News. Part of the impetus was a punishing Dutch tax on dividends. Beyond that, it’s just good housekeeping. Since 2005, the combined company (formed from an original 1907 merger) has been hampered by a complex structure of “A” shares in London and “B” shares in the Netherlands, with each taxed differently. For investors, simplification looks like “a right royal result”. It might also placate a troublesome US activist, Dan Loeb of Third Point, who has been gunning for a full break- up of the company.

After “seven fat years at the helm”, this could be a “last hurrah” for CEO Ben van Beurden, said Alex Brummer in the Daily Mail. That might be just as well.” He, after all, was the boss who “doubled down on oil and gas” by acquiring BG Group for £51bn in 2016. Shell’s most pressing “strategic priority” now is devising “a carbon-neutral strategy which investors can believe in”.