Shell comes under attack from Wall Street raider –

Third Point is one of Wall Street’s highest-profile activist investors. It has shaken up companies ranging from Yahoo to Sotheby’s and Sony, often starting with a florid letter penned by Mr Loeb to management. 

The 59-year-old is said to be a major art collector who was a classmate of President Obama at Columbia University and whose great aunt, Ruth Handler, is credited with inventing the Barbie doll. 

He founded Third Point in June 1995 using his own savings and funding from family. It hit a high point in 2007 when it made $1.5bn in profits before almost collapsing in the financial crisis, according to a Vanity Fair profile in 2013. 

In its letter this week, Mr Loeb said Third Point started taking a stake in Shell earlier this year. 

He said the past two years had been “especially challenging” for Shell shareholders due to the Dutch court case dividend cut in the depths of the pandemic, which has since been partially restored. However, investor returns had been low for two decades. 

“We are early in our engagement with the company but are confident that Shell’s board and management can formulate a plan to accelerate decarbonisation while simultaneously improving returns for its long-suffering shareholders,” Mr Loeb added.

In a statement after markets closed on Wednesday, Shell said it “welcomes open dialogue with all shareholders, including Third Point. 

“Shell’s investor relations team has had preliminary conversations with Third Point and we will engage with them, as we do with all of our shareholders.”

Shell “regularly reviews and evaluates the Company’s strategy with a focus on generating shareholder value”, it added. 

Shares fell 0.7pc to £17.76.

Andrew Logan of shareholder advisory group Ceres said Mr Loeb’s move was a significant development.

“It will force Shell to answer a question that has been on the minds of investors for some time: do legacy oil companies like Shell actually add any value to the low-carbon transition? Is Shell becoming like an old-style conglomerate, where the whole is worth less than the sum of the parts? 

“Or is the opposite true, and that by combining the cash flow of oil and gas assets under the same corporate roof as a high growth, investment intensive clean energy business Shell is actually building a stronger business than either of the two standing alone? If nothing else, the move by Third Point signals that Shell has not convinced the investment community that there is value in keeping all of these businesses in house.”

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