* PIRC, Invesco, Allianz join voices in favour of deal
* BG-Shell share spread remains near 7 pct
* Deal widely expected to win shareholder support
By Ron Bousso and Karolin Schaps
LONDON, Jan 14 (Reuters) - Two weeks before shareholders aredue to vote on Royal Dutch Shell $48 billion bid for BGGroup, more investors have come out in support of thedeal, despite lingering concerns about the effect of falling oilprices on the sector.
The bid has already won the backing of several majorshareholders and advisory groups, with only a handful ofinvestors publicly arguing against its merits even as oil priceshave dropped below $30 a barrel for the first time in 12 years.
On Thursday, British shareholder advisory firm PIRCrecommended shareholders vote in favour of the deal, which wouldtransform Shell into the world's top liquefied natural gas (LNG)trader and a major deepwater oil producer.
Two other advisory groups, Glass Lewis and ISS, issuedsimilar recommendations to investors last week.
Earlier this week, top 20 Shell shareholder Invesco alsolent its support, reinforcing the widespread impression this isa done deal - even if this is not yet fully reflected in the BGshare price.
"Given the fragmented nature of the shareholder base, andthe ability of many holders to have already voted with theirfeet and exited the stock, the chances of 'no' votes crossingthe 50 percent threshold, (are) extremely small in my opinion,"said Martin Walker, Invesco's UK equities fund manager.
"As a result, for Shell management the next few weeks arereally about minimising the embarrassment of high profiledissent," he wrote in a note to clients.
Top 30 Shell shareholder Allianz Energy fund also voicedsupport.
"I am positive on the deal because if you look at Shell'shistoric financial performance, the businesses that have madeconsistently the highest return on capital are deepwater andLNG," Christopher Wheaton, manager of the Allianz Energy fund,told Reuters.
Confounding many investors and observers, however, is thefact that BG's share price still lags the level implied byShell's share-and-cash offer.
The gap has remained stubbornly wide in recent weeks, evenafter the deal received all the required regulatory approvals. On Thursday, it was just below 7 percent.
The spread is a reflection of ongoing concerns over theenergy sector as a whole following the sharp drop in oil pricessince the start of the year, investors said.
"BG shares feel mispriced. If you try to put it up againstcomparable yields it looks ridiculous given how many assume thisis a done deal," one fund manager said.
Shell B shares were up 1.4 percent and BG shares were up 0.5percent at 1405 GMT compared with 0.8 percent gains for thebroader sector index. Brent crude was at $30.58a barrel.
Standard Life Investment last week became the first and sofar the only major shareholder opposed to the deal, due to aweak outlook for oil prices and risks related to BG's assets inBrazil.
Shell has outlined a slew of cost-saving measure, assetsales and job cuts aimed at boosting its balance sheet to helpfinance the deal and weather the downturn.
(Editing by Mark Trevelyan)
