Shell plc has launched a bond exchange offer targeting six series of USD-denominated notes, representing a total outstanding amount of $8.4bn issued by Shell International Finance B.V. and BG Energy Capital plc. The goal is to transfer these liabilities to Shell Finance US, a recently established subsidiary, in order to optimise the group’s financial structure and align its debt profile with its North American operations.
Six bond tranches affected
The exchange offer concerns five issuances by Shell International Finance and one by BG Energy Capital plc. Eligible notes include 6.375% guaranteed bonds due 2038 worth $2.75bn, as well as other long-dated instruments maturing as far as 2051. All new securities will be issued by Shell Finance US and fully guaranteed by Shell plc, with financial terms matching the original bonds except for the issuing entity.
The minimum issuance size required for each new bond series is $500mn, a condition for the exchange to proceed. Eligible holders will receive, for each $1,000 face value, $970 in new notes and $1 in cash, with an early participation premium of $30 if accepted before 17 November.
Timeline and eligibility requirements
The offer began on 3 November and will expire on 3 December at 5:00 p.m. New York time, unless extended. To receive the full consideration, holders must submit their acceptance before the early participation deadline, set for 17 November. Bonds may be withdrawn up to that date. No accrued interest will be paid, though the new notes will accrue interest from the most recent payment date of the exchanged securities.
Only qualified institutional buyers in the U.S., and certain non-U.S. professional investors, may take part. The offer is not open to retail holders or investors located in Canada.
Refocus on U.S. market
This restructuring is part of a strategic effort to simplify the group’s USD bond liabilities by consolidating them under a single U.S.-based legal structure. By centralising its American issuances under Shell Finance US, the multinational seeks to improve the efficiency and visibility of its debt across capital markets.
Settlement is expected three business days after the offer expires, on 8 December if no extension occurs. The principal amount of each new note will be rounded down to the nearest $1,000, and the remaining difference will be paid in cash.
