The two parent companies of oil major Royal Dutch/Shell Group announced Thursday that they will unify as a single company, Royal Dutch Shell plc, beginning July 20. The two European companies have been listed independently for nearly a century.

Under the unification plan, the company will create a management board with a U.S.-style CEO and nonexecutive chairman. Royal Dutch, based in The Hague, and Shell Transport and Trading, based in London, will become subsidiaries of the new company. The companies also said that under the plan, the unified company will increase dividends in line with inflation and continue to buy back shares.

The merger, which was announced last October, followed months of scandal for the conglomerate following several downgrades to its oil and natural gas reserves (see Daily GPI, Oct. 29, 2004). Royal Dutch/Shell said the merger would eliminate some of the accounting failures that led it to overestimate its reserves by 23%, or 4.47 billion boe.

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