Activist hedge fund Third Point LLC has accumulated a huge stake in Royal Dutch Shell PLC, as it pushes the firm to break up into two separate entities, WSJ reported.
- Third Point has raised its stake in Shell to over $500 million, becoming one of the energy giant’s biggest investors. Shell currently has a market value of nearly $200 billion.
- The hedge fund is pushing for Shell to become two separate companies, with one focusing on legacy businesses and the other which will be involved in houses renewables, and other units requiring major investments.
- Third Point said the separation would clarify Shell’s strategy and its attractiveness to different sets of investors who have been making different demands.
- Shell earlier this year unveiled plans to boost its shift to reduce its carbon emissions by cutting down oil production and investing more in biofuels and electric-vehicle charging.
A Dutch court in May ordered Shell to reduce its emissions by 45% by 2030, which the company plans to appeal. RDS-A is down 3.62% premarket.