Tag: M and A

Wed 11 Apr 2018

Shell to further power progress on the Global Vehicle Trust OX: the inventive flatpack truck
Shell is collaborating with Gordon Murray Design to make this mission happen

Shell has announced that it will commission a pre-production prototype of the world’s first flat-pack truck and it will take this truck to India, which is home to almost 18% of the world’s population1. The ‘OX to India’ mission will showcase the capabilities of the vehicle for bringing low-cost all-terrain mobility to rural communities in developing countries.

The ‘OX to India’ mission is a partnership between Shell and Gordon Murray Design (GMD), working in close alignment with the Global Vehicle Trust (GVT). This represents a crucial development stage of the vehicle, which was officially launched in 2016.

Shell will fund a bespoke prototype OX to take to India and will set up an outreach programme once the vehicle is in India. The vehicle will be re-engineered and built by GMD, and flat-packed for shipment to India in the later part of 2018.

The OX, based on GMD’s flexible iStream® technology, will run exclusively on Shell fluids including Shell Rimula, a hard-working and high-performing diesel engine oil designed to help heavy duty and light duty engines to run efficiently in demanding conditions.

“Shell is eager to play a role alongside others in developing and promoting mobility solutions in developing regions. The OX to India demonstration will see the concept validated and discussed on the ground in a real world setting. We know limited mobility in hard-to-reach communities in developing economies can restrict access to basic services, and can limit the effectiveness of efforts to improve the quality of life. The OX has the potential to broaden access to transport possibilities and all the resulting benefits that come with this,” said Huibert Vigeveno, Executive Vice President, Shell Global Commercial.

The OX is designed to carry a payload of 1,900kg (approximately twice the capacity of most current pickups), which could include everyday necessities, medical supplies, building and agriculture materials. It can seat up to 13 people. The vehicle was envisioned by entrepreneur and philanthropist Sir Torquil Norman and designed by renowned automotive engineer Professor Gordon Murray.

Other innovative features of the OX include:

Lightweight, rugged and durable design to maximise payload for goods and people

Low cost, simple maintenance through accessible components and fewer parts

Designed for self-assembly, supplied fully assembled or flat-packed for easy shipping and local assembly

Sir Torquil Norman, founder of GVT said: “I’m so pleased to welcome Shell aboard the OX project and for sharing GVT's vision that this remarkable and versatile vehicle will provide a transformation in affordable mobility for so many people where the need is most acute. With Shell taking the OX to India we can demonstrate its capability in a key market, which will help attract long-term production partners.”

Professor Gordan Murray, Executive Chairman, GMD said: “After our highly successful co-engineering Shell Concept Car programme with Shell, it is exciting to be once again working with Shell on the next phase of this extremely important and ground-breaking project.The OX is one of our most important engineering designs and it is certainly the vehicle of which I am most proud of, as its disruptive design has the potential to change the current mobility model and with Shell’s vision this vehicle could go on to improve so many people’s lives.”

Recognising the need for sustainable, cleaner and more energy efficient transportation solutions, Shell is collaborating and co-engineering a number of projects. In 2016, Shell partnered with Gordon Murray to coengineer the Shell Concept Car – an ultra-efficient city vehicle that, compared to a typical city car, uses 34% less primary energy over its entire lifetime. Shell is also partnering with AirFlow Truck Company to develop a new hyper-fuel mileage Class 8 truck known as the Starship. Its aerodynamic design will seek to demonstrate improvements in fuel economy for while lowering CO2 emissions.

-End-

ENQUIRIES:
Shell Lubricants Global:
Mary B. Walsh, +32478402938, mary.walsh@shell.com
Yashidha Kumari, +65 6390 7345, y.sevakumar@shell.com

Gordon Murray Design Limited:
Sarah Smith, +44 (0) 1483 484700, sarah.smith@gordonmurraydesign.com

Global Vehicle Trust:
Ed Callow, PFPR Communications, +44 (0)1622 766520, ed.callow@pfpr.com

Notes to Editors:

1Source: United Nations, World Population Prospects: The 2017 Revision

Link to images of OX: https://www.flickr.com/photos/royaldutchshell/albums/72157671223809135

The OX’s revolutionary nature extends beyond the vehicle design because, uniquely, it is capable of being flat-packed within itself, enabling it to be transported more efficiently around the world. It takes three people less than six hours to create the flat pack in the UK prior to shipping, and six of these flat packs can be shipped within a 40ft high-cube container. Assembly labour is transferred to the importing country, where local professional companies will be employed to assemble and maintain the finished vehicles. Three skilled people can put an OX together in approximately 12 hours.

The overall vehicle length is far shorter than a large SUV, and yet it can carry a payload of 1900kg (approximately twice the capacity of most current pick-ups) with a load volume of 9.0 m3. Based on EU size guidelines, it can seat up to 13 people or carry eight 44-gallon drums or three Euro-pallets.Figures are based upon production targets.

For more information visit: http://oxgvt.com/

Royal Dutch Shell plc
Royal Dutch Shell plcis incorporated in England and Wales, has its headquarters in The Hague and is listed on the London, Amsterdam, and New York stock exchanges.Shell companies have operations in more than 70 countries and territories with businesses including oil and gas exploration and production; production and marketing of liquefied natural gas and gas to liquids; manufacturing, marketing and shipping of oil products and chemicals and renewable energy projects. For further information, visit www.shell.com.

About Gordon Murray Design Limited
Gordon Murray Design Limitedis a British company operating from Shalford, Surrey. The Company is recognised as a world leader in automotive design and reverses the current industry trend for sub-contracting by having a complete in-house capability for design, engineering, prototyping and development. The Company is compact and focused and undertakes automotive and other engineering programmes in an efficient and innovative way. For more information please visit www.gordonmurraydesign.com.

The iStream® technology is a complete rethink and redesign of the traditional automotive manufacturing process and could potentially be the biggest revolution in high volume manufacture since the Model T. Development. The process began over 15 years ago and it has already won the prestigious ‘Idea of the Year’ award from Autocar who were given privileged access in order to make their assessment. The simplified assembly process means that the manufacturing plant can be designed to be 20% of the size of a conventional factory. This could reduce capital investment in the assembly plant by approximately 80%. Yet the flexibility of this assembly process means that the same factory could be used to manufacture different variants. The iStream® design process is a complete re-think on high volume materials, as well as the manufacturing process and will lead to a significant reduction in full lifecycle CO2. For more information please visit www.istreamtechnology.co.uk

About the Global Vehicle Trust
In 2010, Sir Torquil Norman founded the Global Vehicle Trust (GVT) to pursue his ambition to help people in the developing world by providing cost-effective mobility for all. The GVT subsequently briefed renowned automotive designer Professor Gordon Murray on a unique humanitarian programme to create a revolutionary lightweight truck. As part of an aid programme, the Global Vehicle Trust OX could provide an essential element of infrastructure to enable the local population to raise the community’s standard of living, and to assert its independence by gaining control of its transportation needs and costs.

Sir Torquil Norman is a former pilot, banker, company executive and toy manufacturing entrepreneur. He is a passionate philanthropist, and is chiefly responsible for the rescue and renovation of The Roundhouse in Camden, north London.

Cautionary note
The companies in which Royal Dutch Shell plc directly and indirectly owns investments are separate legal entities. In this press release “Shell”, “Shell group” and “Royal Dutch Shell” are sometimes used for convenience where references are made to Royal Dutch Shell plc and its subsidiaries in general. Likewise, the words “we”, “us” and “our” are also used to refer to Royal Dutch Shell plc and subsidiaries in general or to those who work for them. These terms are also used where no useful purpose is served by identifying the particular entity or entities. ‘‘Subsidiaries’’, “Shell subsidiaries” and “Shell companies” as used in this press release refer to entities over which Royal Dutch Shell plc either directly or indirectly has control. Entities and unincorporated arrangements over which Shell has joint control are generally referred to as “joint ventures” and “joint operations”, respectively.Entities over which Shell has significant influence but neither control nor joint control are referred to as “associates”. The term “Shell interest” is used for convenience to indicate the direct and/or indirect ownership interest held by Shell in an entity or unincorporated joint arrangement, after exclusion of all third-party interest.

This press release contains forward-looking ..

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For Tesla, ‘going dark’ might not be as easy as just turning off the lights

Simon Dawson | Bloomberg | Getty Images
Elon Musk, billionaire, co-founder and chief executive officer of Tesla Motors Inc.

Elon Musk still hasn't made a formal proposal to take Tesla private, an idea he floated last week in a series of tweets he has since attempted to clarify.

Many questions remain about his plan, chief among them how he would pull off taking private a $60 billion publicly traded company.

Lawyers and advisors tell CNBC it's not going to be as simple as “going dark,” as smaller companies have done in a big wave in the decade since the financial crisis. In order to pull that off, a company has to have fewer than 300 shareholders (or 500 in some cases). The process involves filing a few forms with the Securities and Exchange Commission and removing the shares from the exchange where they were listed.

It has been an escape for hundreds of companies over the last decade that found themselves crippled by the pressures of having to meet rigorous public financial disclosure requirements. But Tesla is a big company, and removing itself from the public market is a lot more complicated.

“No one has done it on this large a scale,” said Peter Bible, chief risk officer of EisnerAmper and a former chief accounting officer of General Motors.

Usually, the investing public waits impatiently for the next hot initial public offering, but Silicon Valley's tech elite has been disappointing those expectations lately. Many are content to stay private. CB Insights counts 260 $1 billion-plus “unicorns” with a combined private valuation of $840 billion. Last year, there were 160 IPOs versus 486 in 1999 at the height of the dot-com frenzy, according to Statista.

Constant pressure from shareholders and analysts about near-term performance was enough to drive companies like Dell and Tibco to move in the opposite direction and go private, but through the traditional buyout route where shareholders are cashed out.

Tibco, a business intelligence software maker, delisted from Nasdaq in 2014 and went private through a $4.3 billion deal with Vista Equity Partners. “Private provides you with the leeway you do't have in a public setting,” its chief technology officer told Britain's CIO magazine at the time.

Tesla debuted on the Nasdaq in 2010, raising $226 million as its shares jumped 41 percent on their first day of trading, and it has returned to the market several times since then issuing more shares. Musk's personal stake in the company has risen in value from $512 million at the time of the IPO to $12.8 billion.

But the electric car company's founder and CEO has complained that being publicly traded invites distracting focus on short-term financial goals and makes Tesla the target of traders who attack the company in order to profit from a decline in its shares.

How it's done

Simply going dark is a multistep process. The exchanges need several days notice of the plan, and the public has to be informed at the same time. Then forms are filed with the SEC, one to notify it of the delisting and another to deregister the shares if the company has 300 or fewer shareholders. But if the shareholders aren't bought out with cash, the shares continue to trade, moving over to the more thinly traded over-the-counter market.

Going private requires cash to buy out the minority shareholders, usually through a merger, tender offer or reverse stock split.

But Musk's proposal adds a complicating factor.

He has said he wants to preserve a broad ownership of Tesla as a private company. That might be impossible for the mom and pop investors in the stock now who don't qualify to invest in private companies as accredited investors. If they want to keep their ownership, it might have to be through a special purpose fund, something Musk has mentioned.

And that special purpose fund might have to be publicly traded, Morningstar's David Whiston said.

“Issues around regulatory approval come to mind because it is unclear how Tesla will allow retail investors who are not accredited investors to own stakes in a private Tesla,” he wrote in a note this week. “That issue is why we think the special-purpose vehicle Musk pointed to in the Aug. 7 email may have to be publicly traded.”

Tesla said Tuesday its board has set up a special committee to examine Musk's idea. Lawyers for the committee and the company have been hired, and Musk has tweeted that he has his own advisors, including the private equity firm Silver Lake, which is said to be interested in a possible investment.

The special board committee, including directors Brad Buss, Robyn Denholm and Linda Johnson Rice, hadn't reached any conclusions about “the advisability or feasibility” of a transaction and that it could consider alternatives, Tesla said Tuesday. Shareholders would also have to vote on a transaction, lawyers and advisors said.

That's another complicating factor, lawyers said. There's no guarantee that enough shareholders will agree or that enough will want to sell their shares at Musk's suggested $420 price to get Tesla's shareholder count low enough to deregister the shares. Whiston estimates about 40 percent of the shareholders might take the money, and that would cost about $28.7 billion.

Depending on state law, he'd have to get a super majority of shareholders (in Delaware, it's 90 percent) to be able to squeeze out any holdouts, lawyers said. But Musk has said there will be no forced sales.

Its biggest investors, aside from Musk himself, are mutual funds and money managers in addition to China's Tencent and Saudi Arabia's sovereign wealth fund. Collectively this group holds about 66 percent of the shares. About 17 percent are owned by investors who are too small (either in the amount of Tesla they own or the size of their portfolios) to have to report their stakes. Musk has said he believes two-thirds of Tesla's shareholders will stick with it as a private company.

The deal could turn out to be as unique as the collection of space transportation, electric automobile, high-speed transportation and solar power generation projects Musk has cobbled together in his business empire.

“There is a recipe for going private, but like everything else, Elon Musk does it his own way,” said Barry Genkin, a partner at law firm Blank Rome. “He hasn't put any meat on the bones and everyone is scratching their heads about what he means.”

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