🛢️ Shell $SHEL is considering selling its US chemical assets for up…

· Aug 24

🛢️ Shell $SHEL is considering selling its US chemical assets for up to $8 billion.

According to the Financial Times, ExxonMobil $XOM, LyondellBasell $LYB and Apollo $APO are among those interested in the plants in Louisiana, Texas and Pennsylvania. Some bidders are interested in the whole package, others only in parts.

Shell has been gradually divesting parts of the business it is not happy with, trying to move capital to where it makes more sense. A potential $8 billion is no longer a negligible amount.

On the other hand, Shell has invested significantly more in these assets in the past, so a potential sale also shows that this part of the business did not quite work out as originally envisioned.

Do any of you have Shell in your portfolio? And how do you like the company's current direction?

A community member's personal view, not investment advice. Community Guidelines

Dušan Kubala @dusankubala Aug 25

I don't know if 8 billion is a crucial amount for the company today when they earn more per quarter and instead of reducing debt faster they do buybacks, but maybe it really wasn't financially attractive and even LyondellBasell recently divested, so who knows exactly what they have planned, but I don't think the company is struggling at today's oil and gas prices

Martin Sedláček @martinsedlacek Aug 25

Yeah, I agree that Shell certainly doesn't need those 8 billion because of any cash shortage. Rather, I see it as a question of capital allocation. If those chemical plants are in the long term less profitable than the rest of the portfolio, it makes sense to sell them and use the money for buybacks, debt, or projects with higher returns. Do you have any energy companies in your portfolio?

Stocks slide as strong jobs data revives rate-hike fears