Weekend paper tip26 Jan 2020 17:41
has set me thinking. If the divi stays the same for the next ten years I will have recouped about two thirds of entry price. They are also investing a 'humble' £2,000,000,000 a year approx in renewables. This is not a large % of Shell's investments but by standards of renewable energy investment companies, it is pretty huge. So suppose in a few years they were to spin off that part of their business as, say, Royal Dutch Renewable Energy, would the sum of the parts be worth more than the whole?
In my view the quicker they do that, the more likely the answer would be yes. The longer they leave it, the lower the RDS price would fall because it would be nearer to obsolescence.
I am considering a buy to hold as it is unpopular and good value. But, although I am only considering, I think
a spin-off of their renewables arm sooner, rather than later, isn't impossible and is in the price for virtually nothing.
I already hold a number of alt energy plays, this may be a shrewd counterweight. Any thoughts?