Shareholders of ARC Resources Ltd. (TSX:ARX) on Tuesday delivered near-unanimous support for the company's proposed sale to Shell PLC (LSE:SHEL), bringing the $16.4 billion deal markedly closer to completion. Company disclosures show 99.54% of votes cast at a special meeting were in favor of the acquisition.
Shell announced the agreement earlier this year as part of its plan to expand natural gas operations in North America. ARC said that a number of regulatory approvals have already been obtained, including competition clearances from authorities in both Canada and the United States.
Despite those clearances, the transaction still requires judicial approval. ARC noted that the deal now awaits authorization from the Court of Kings Bench of Alberta, with a hearing scheduled for Wednesday.
In advance of the shareholder vote, Shell paused its $3 billion share buyback program. The suspension was undertaken to comply with securities law requirements connected to the acquisition process. Separately, the Alberta Securities Commission granted Shell relief from certain requirements related to its repurchase programs in the United Kingdom and the Netherlands, a step ARC described as satisfying another condition necessary to move the transaction forward.
The vote result and the list of completed regulatory steps indicate the deal has met several key procedural milestones, while the pending court hearing represents one of the remaining formal clearances required to close the transaction. Beyond the legal and regulatory actions already completed, ARC and Shell have signaled the acquisition remains subject to the outstanding judicial approval noted by the companies.
Clear summary
ARC Resources shareholders approved Shells proposed acquisition by a margin of 99.54% of votes cast. Multiple regulatory approvals in Canada and the United States have been secured. The transaction now awaits a scheduled hearing before the Court of Kings Bench of Alberta. Shell temporarily suspended a $3 billion share buyback to meet securities law requirements, and the Alberta Securities Commission granted relief related to repurchase requirements in the UK and the Netherlands.
Key points
- Shareholder approval: 99.54% of votes cast supported the $16.4 billion acquisition.
- Regulatory progress: Competition clearances have been secured in Canada and the United States.
- Procedural milestone outstanding: A hearing before the Court of Kings Bench of Alberta is scheduled for Wednesday and remains required for completion.
Risks and uncertainties
- Judicial approval is still required - the scheduled hearing at the Court of Kings Bench of Alberta represents a remaining procedural hurdle.
- Completion conditions tied to securities law compliance affected corporate actions - Shell suspended its $3 billion buyback to satisfy those requirements, showing administrative steps can influence shareholder programs.
- Regulatory relief and approvals were necessary in multiple jurisdictions - outstanding administrative or legal requirements in any relevant jurisdiction could still affect timing.