THE HAGUE, Netherlands, Jan. 27 (UPI) -- More than 80 percent of shareholders in Royal Dutch Shell voted in favor of combining with British energy company BG Group, the Dutch supermajor said.
"I am delighted with the positive shareholder vote and the confidence that shareholders have shown in the strategic logic of the combination of Shell and BG," Shell CEO Ben van Beurden said in a statement.
Shell shareholders were asked to approve the acquisition of BG Group by the company. The Dutch supermajor said just over 83 percent of its shareholders voted in favor of the deal.
Shell said combining with BG Group would mark the start of a new chapter for the company. Costs will move lower by about $4 billion for 2016, but also result in widespread redundancies. About 10,000 staff and director contractor positions will be eliminated across both companies.
The $7 billion tie-up with BG Group will be one of the largest mergers of its kind since Exxon and Mobil joined in the 1990s. For the combined group, Shell in a prospectus last year said capital investments for 2016 would be around $33 billion, lower than previously forecast by $2 billion, or 5.7 percent.
Crude oil prices are trading at or near low levels not seen in a decade, leaving energy companies without capital needed for strong investments.
Shell through the deal takes on a larger footprint in the liquefied natural gas sector, a sector less dependent on the geopolitical constraints in the midstream, or transit, part of energy. Economic and political disputes between Russia and Ukraine, for example, pose threats to European energy security.
BG shareholders vote on the measure Thursday. If approved, the transaction would be finalized Feb. 15.