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Shell takeover of BG sparks North Sea jobs fears: Royal Dutch Shell’s takeover of smaller U.K. rival BG Group is fuelling anxieties about industry job losses in Aberdeen, centre of the North Sea oil sector, because both companies have substantial operations there.

Atom Bank keeps faith with wearable technology: The Chief Executive of Atom Bank is looking to wearable technology for the future of banking in spite of concerns about customers resistance

Warning over BG Group Chief payoff after takeover deal: One of the City’s leading fund Managers has warned BG Group to “exercise appropriate judgement” when it decides how much to pay its outgoing Chief Executive

Squeeze on homes as Owners stay put longer: The average homeowner lives in a property for nearly a quarter of a century, almost three times longer than in the Eighties, blocking would-be buyers from stepping on to the property ladder.

Shell’s deal needs oil to hit $90 by 2018, says analyst: The price of oil will need to rise by more than 50% to make the economics of Shell’s purchase of BG stack up, according to one forecast.

UK Halifax house price index rises less than expected in March In the UK, the Halifax house price index registered a rise of 8.10% for the period of January to March on an annual basis, compared to an advance of 8.30% for the previous three months. Market expectations were for the Halifax house price index UK Halifax house price index advanced more than expected in March In March, the Halifax house price index in the UK advanced 0.40% on a MoM basis, more than market expectations for an advance of 0.10%. In the prior month, the Halifax house price index had recorded a revised drop of 0.40%.

At 0330GMT today, Brent crude oil one month futures contract is trading 0.37% or $0.21 higher at $56.78 per barrel. Yesterday, the contract climbed 1.84% or $1.02, to settle at $56.57 per barrel, as further uncertainties over Iran’s potential nuclear deal emerged after Iran’s leader expressed doubts on the prospects of completing a deal with world powers that would reduce the nation’s nuclear program in return for easing sanctions.

CONCLUSION “Deal risk” is attractively priced, at 1150p- BG is a cheap way into Royal Dutch Shell at 1700p with an attractive near 7.5% forward dividend yield. We see deal completion as at least six months away ie Q4 2015 assuming no delays/ deal failure.

Royal Dutch Shell/ BG – merger will create largest co in FTSE 100 During a Bloomberg conference call yesterday morning, Royal Dutch Shell CEO Ben van Beurden said BG made a compelling merger fit and that the timing of the acquisition (in the context of the oil price collapse) was the best in years. A merger between Shell and BG had been discussed “on and off” for a decade. BG adds 25% to Shell’s “proved” P1 oil reserves and 20% to oil & gas production whilst adding its LNG (liquefied natural gas) portfolio (c. 16% of global LNG) and its offshore assets in Brazil, Tanzania and Australia. The asset side combination diversifies Shell considerably adding growth assets principally in Brazil to offset declining production from Shell’s West African oil fields in Nigeria and Gabon. On the synergy side, in terms of capital expenditure adding the two budgets together gets to $42bn (BG spent $9.7bn in 2014). Shell expects to reduce capital spending by $2.5bn post-merger though it could reduce spending by c $4bn. The merger would mildly boost EPS in 2017 but strongly boost EPS in 2018 assuming Shell’s forecast assumption of $75 oil in 2017 and $90 in 2018-2020. Shell does not expect a change in its debt ratings (S&P AA, Moody Aa1) as its balance sheet gearing would have been c.20% using end 2014 numbers on a pro-forma basis (ie. if both companies had been merged end 2014). It is worth noting though that both rating agencies have negative outlooks given the oil price context. The BG merger terms break down as follows; 9.52p interim dividend (ex 23rd April 2015) plus 383p (cash per share) plus 0.4454 RDS (B) shares per BG share. This equates to a grossed up value of 1700.6p per RDS (B). Not only is this a 12.3% discount to Royal Dutch Shell B shares (2002p- 62p expected RD dividend) it offers a forward yield of 7.47% based on Shell’s promised $1.88 (127p) 2016 dividend. Recent FY14 results from BG Group, loss of $5.03bn after $8.9bn of asset write downs were uninspiring. Crucially BG’s production growth that, during 2010-2013 had caused BG’s shares to trade at a premium to the oil sector, had ended. During Q4 2014 BG’s E&P production was 630k boepd (barrels of oil / oil equivalent per day) down 1%, over 2014 production was down 4%. BG has the quandry of further commitment to Egypt after losing $2bn in 2013 and a further $750m during 2014 in Egypt. Shell has rescued BG from problematic capital commitments in 2015. BG takeover premium of 50% is a massive premium. £47bn ($69.5bn) represents $40.4bn above (2.4x) BG’s end 2014 book value of $29.1bn. There are a number of oil companies at discounts or near to book value, (BP) that are cheaper. Has Shell overpaid? That was the kneejerk response in Shell yesterday and that looks clear.

UKOG's oil find is located in Britain's southern Weald Basin, a largely rural area near the airport which lies adjacent to Europe's largest onshore oil field, located at Wytch Farm. A government-commissioned report said last year the Weald Basin also holds 8.57 billion barrels of shale oil, a type of oil trapped in underground rock which is different to the oil explored for by UKOG. UKOG said in a statement to the stock exchange that an independent report estimated some 158 million barrels per square mile could be lying below its Horse Hill-1 well just north of Britain's second-largest airport, much more than first thought. Of the overall forecast 100 billion barrels, Sanderson said he believed between 5 and 15 percent could be recovered, meaning that by 2030 the Weald area could contribute between 10 and 30 percent of the country's oil needs, he said. In comparison, Kuwait's proved reserves amount to 101.5 billion barrels, according to BP's annual statistics, while Britain has extracted 45 billion barrels from the North Sea since the 1970s. "Although the numbers sound good, this discovery is unlikely to prove a significant tonic for the UK energy industry," said Mike Jakeman, global commodities analyst at the Economist Intelligence Unit. He said oil from the well was probably too expensive to produce at a time when weak Brent crude prices mean companies are favouring projects with lower costs. UKOG is the main investor in the Horse Hill project, while other stakeholders include Stellar Resources, Solo Oil and Alba Mineral Resources. (Reporting by Karolin Schaps; editing by Peter Graff)

LONDON, April 9 (Reuters) - Iraqi Kurdistan-focused oil producer Gulf Keystone Petroleum has reported a $248.2 million loss after tax for 2014 as the company said it was still owed around $100 million for crude oil it has sold. The company, which is continuing discussions with undisclosed parties to sell certain assets or the entire firm, increased oil production significantly last year to an annual gross output of 6.48 million barrels of oil. Its flagship Shaikan oil field in Iraqi Kurdistan is currently producing more than 37,000 barrels of oil per day to deliver crude to an unnamed partner who has pre-paid $26 million for the supply. Gulf Keystone has been hit hard by the consequences of a dispute between Iraq's central government and the Kuridstan Regional Government about oil exports from the resource-rich autonomous region. (Reporting by Karolin Schaps; Editing by Li-mei Hoang)

The latest Moneyfacts UK Mortgage Trends report has revealed that average mortgage rates fell further this month, fuelling the first rise in remortgage activity since September. The figures show that the average two-year fixed rate fell by 0.09%, down from 3.06% to a new record of 2.97%. Significantly, this is the first time that the rate has fallen below 3% since Moneyfacts began recording this measure in 2007, with competition across the sector remaining robust. Arguably, it's this that's fuelling the rise in remortgage figures, with data from the CML showing a clear uptick: the number of remortgage advances totalled 25,600 in January, up from 22,300 in December 2014 and the first increase in four months. Lower mortgage rates will have been a significant catalyst, but looking closer at the figures offers another level of analysis. A particularly noticeable trend is the difference between standard variable rates (SVRs) and average fixed rates, not only in the present climate, but also taking into account borrowers' previous fixed rate deals. Moneyfacts' figures show that the average two-year fixed rate in April 2013 was 3.80%, while the average SVR currently stands at 4.85%. Therefore, the difference between the average two-year rate (based on a two-year lag) and the current SVR is 1.05%, a differential that will increase further should SVRs remain unchanged. This suggests growing motivation to remortgage, the report noted, an inference already supported by CML data, and if rates remain low, the increase in remortgaging activity could continue.

UK Oil & Gas, the exploration company, says it has a site in the south of England could turn out to be a goldmine of oil, with analysis showing a well has 158m barrels per square mile.

Brazil is the big prize for Shell in BG deal £47bn takeover excluding debt also cements company’s dominance in producing, exporting and trading LNG

Federal Reserve officials divided over timing of interest rate hike: U.S. Federal Reserve members clashed during their meeting last month over whether to begin hiking interest rates in June or to wait until the second half of this year, according to the minutes from the meeting released.

Oil and gas pioneer Steve Remp returns to the fray: Steve Remp, the Founder of Ramco Energy, appears to have made progress in his attempts to breathe new life into one of the company’s former projects in Eastern Europe.

Future of BP as independent company thrown into doubt by Shell’s takeover of BG; The future of BP as an independent company was thrown into doubt as analysts said BG’s takeover will prompt a wave of consolidation in the struggling sector

Stay invested in Shell: The success of any deal, no matter how big or small, always comes down to the price, and Shell’s takeover of rival BG Group certainly isn’t cheap. At £47 billion, Shell is paying a high price to add about 29% to its oil and gas reserves. Through BG, it is getting access to fast-growing production from Brazilian and Australian gas fields. However, the benefits from the deal don’t really kick in for another two years, during which time Shell investors face increased risks. The other big factor is that much of the success of the deal has been based around the oil price recovering to more than $90 per barrel from 2018 Analysts have estimated Shell is also paying a 27% premium to the value of BG’s oil and gas assets. The reason for the dilution is that Shell will be buying BG with £13.2 billion, or 28%, in cash and £33.8 billion, or 72%, by issuing new Shell shares. Shell has calculated that it would need to issue 1.5 billion new B shares to fund the deal, giving BG shareholders a 19% stake in the new combined company. The price Shell has agreed with BG represents an offer of about £13.50 for each BG share. Shell had to offer an amount that comfortably beat BG’s previous day’s closing price of 910p to entice the company into a deal and scare off any rival bids from the likes of Exxon. The reason for the dilution is that Shell will be buying BG with £13.2 billion, or 28%, in cash and £33.8 billion, or 72%, by issuing new Shell shares. Shell has calculated that it would need to issue 1.5 billion new B shares to fund the deal, giving BG shareholders a 19% stake in the new combined company. Shell investors will have a better idea of the outlook for oil prices by the end of the year and that will have a large bearing on whether the price paid looks too high. Shell has historically been a low-risk, dividend-paying share. The company is increasing those risks for a few years to buy assets while oil prices are low. A sensible move if the price is right. Shell at £20.19-189p. Questor Says “Hold”.

Atkins delivers cash surprise: WS Atkins gave investors a mixed picture in a pre-close trading update. The U.K.’s largest engineering group said it had more cash than previously expected, but warned of a contract hiatus around the forthcoming general election. WS Atkins said that it expects to have £175 million in cash on the balance sheet at the year ended March, up from £135 million in previous guidance. The jump was due to successful negotiations for additional work on U.K. rail contracts, and tight control of spending across the rest of the group. The Epsom-based firm’s U.K. division is responsible for half of the group’s revenue and 45% of its profits. The company said the U.K. arm enjoyed improved trading conditions in the second half of the year. However, management warned of a “hiatus on decision making” for infrastructure projects around the general election on May 7. Elsewhere, the North American business expects to report an improvement in profit margins, and the Asia Pacific region reported that the slowdown in China will continue into the current year. The shares are down 3.8% so far this year and that looks somewhat unfair. The company has a strong balance sheet with a prospective dividend yielding 2.9% that is covered more than twice by spare cash flow. The shares are trading on a forward price-earnings ratio of 13 times, falling to 12 times next year, which looks like a good price. WS Atkins is a high-quality company and Questor retains its hold advice. WS Atkins at £13.17+12p Questor Says “Hold”.

Asset Managers pose growing threat to global financial system, warns IMF: The growth of the asset management industry poses risks to global markets that have not been fully appreciated, the International Monetary Fund has warned.