CALGARY, AB (By ARC 27.Apr.2026, Words: 1,318) — ARC Resources Ltd. announced that it has entered into a definitive arrangement agreement with Shell plc and Shell Canada Limited, a wholly owned subsidiary of Shell, whereby Shell has agreed to acquire all of the issued and outstanding common shares of ARC in a cash and share transaction valued at approximately $22bn, including assumed net debt.
HIGHLIGHTS
- The $32.80 per share purchase price – payable 75% in ordinary shares of Shell and 25% in cash – represents a 27% premium to ARC’s 24 Apr. 2026, closing price on the Toronto Stock Exchange (TSX).
- Near-term liquidity to ARC shareholders in the form of cash with highly liquid Shell shares provides upside exposure to an integrated global energy platform.
- The agreement strengthens Shell’s integrated gas business and creates a new platform for growth in Canada by adding long‑duration, high‑quality Montney resource.
- Addition of ARC employees adds deep Montney expertise with a track record of operational excellence to complement Shell’s strong culture and world-class organization. Â
- Significant opportunities to unlock and accelerate LNG-related value through Shell’s integrated natural gas value chain – scale, infrastructure footprint and global reach underpin enhanced long-term profitability.
- The transaction has received unanimous approval by ARC’s board of directors which recommends ARC shareholders vote FOR the transaction at a special meeting expected to be held in Jul. 2026.
Under the terms of the arrangement agreement, holders of ARC shares will receive 0.40247 of a Shell share and $8.20 in cash consideration in exchange for each ARC share, representing total consideration of $32.80 per ARC share, based upon the closing price of Shell shares on the London Stock Exchange (LSE) and the daily GBP/CAD exchange rate published by the Bank of Canada as of 24 Apr. 2026.
The proposed Transaction is to be completed by way of a plan of arrangement under the Business Corporations Act (Alberta) (the “ABCA”) and, subject to satisfaction of conditions typical for a transaction of this nature, is expected to close in the second half of 2026.
“Over our 30-year history, we have built a strong and resilient Canadian energy company defined by the depth of our world-class Montney assets, low-cost operations, leadership in responsible development, and high-performance people and culture,” said Terry Anderson, president and chief executive officer, ARC Resources Ltd. “On behalf of our leadership team, I would like to thank our people for their dedication and commitment to excellence in all facets of our business. Through this transaction, we will realize this tremendous value and become part of a dynamic global energy leader capable of realizing the full potential of our business and delivering on Canada’s exciting energy future.”
“The ARC board unanimously recommends this strategic transaction to our shareholders,” said Hal Kvisle, Chair of the ARC board. “This agreement delivers compelling value for our shareholders and brings together two companies with shared commitments to safety, operational excellence and care for communities and people – strengthening our ability to deliver resilient, long-term value creation for many years to come.”
“ARC is a high-quality, low-cost and top-quartile low carbon intensity producer that complements our existing footprint in Canada and strengthens our resource base for decades to come. ARC has demonstrated a strong track record of operational excellence and responsible development which aligns closely to how we do business. We look forward to welcoming our new colleagues into the organization and together, furthering our strategy of delivering more value with less emissions,” said Wael Sawan, chief executive officer, Shell.
STRATEGIC RATIONALE AND SHAREHOLDER BENEFITS
Attractive Premium and Value
- The consideration represents a 27% premium to ARC’s 24 Apr. 2026, closing price on the TSX.
- The premium accelerates the realization of value for ARC’s undeveloped inventory and inherent value in the company’s underlying Montney resources.
Near-term Liquidity with Global Energy Platform Exposure
- The consideration mix offers near-term liquidity in the form of cash and continued equity exposure through highly liquid Shell shares.
- ARC shareholders receiving Shell shares will gain exposure to one of the world’s largest integrated energy companies, with a robust balance sheet and a track record of consistent shareholder returns.
Enhanced Shareholder Returns
- ARC shareholders will benefit from continued shareholder returns with a Shell quarterly dividend of US$0.372 per Shell share.
TRANSACTION DETAILS
Under the terms of the arrangement agreement, ARC shareholders will receive 0.40247 of a Shell share and $8.20 in cash consideration in exchange for each ARC share, representing total consideration of $32.80 per ARC share, based upon the closing price of Shell shares on the LSE and the daily GBP/CAD exchange rate published by the Bank of Canada as of 24 Apr. 2026.
The proposed transaction will be effectuated pursuant to a plan of arrangement under the ABCA, which is required to be approved by the Court of King’s Bench of Alberta. The transaction will require approval by 66 2/3 per cent of the votes cast by the ARC Shareholders present in person or represented by proxy at a special meeting of ARC shareholders to be called to consider the transaction, expected to be held in Jul. 2026.
In addition to shareholder and court approvals, the Transaction is subject to applicable regulatory approvals, including approvals under the Competition Act (Canada), the Investment Canada Act, the Canada Transportation Act, and the Hart-Scott-Rodino Antitrust Improvements Act of 1976. Subject to the satisfaction of such conditions, the transaction is expected to close in the second half of 2026.
The arrangement includes representations and warranties, conditions and covenants of the parties typical for transactions of this nature including a non-solicitation covenant on the part of ARC, a right of Shell to match any superior proposal subject to customary fiduciary-out provisions, and a fee payable by ARC in the amount of $600mn if the arrangement agreement is terminated in certain circumstances.
Subject to ARC board approval, ARC is expected to continue paying its regular quarterly eligible dividend amount of $0.21 per ARC share until closing of the Transaction, with the next quarterly eligible dividend expected to be paid on 15 Jul. 2026 to shareholders of record on 30 Jun. 2026.
Further details with respect to the arrangement will be included in the ARC management information circular which, when finalized, will be filed under ARC’s profile on SEDAR+ at www.sedarplus.ca and available on ARC’s website at www.arcresources.com/ShellAcquisition.
BOARD OF DIRECTORS RECOMMENDATION
In Mar. 2026, ARC formed a special committee of independent directors to oversee and lead the negotiation of the proposed transaction with Shell.
The ARC board, after considering the recommendation by the special committee, and after consultation with its financial and legal advisors, has determined that the transaction is in the best interests of ARC and is fair to ARC shareholders and has unanimously recommended that the ARC shareholders vote in favour of the special resolution approving the Transaction at the ARC shareholder meeting.
FINANCIAL ADVISORS AND FAIRNESS OPINION
RBC Capital Markets is acting as exclusive financial advisor to ARC.
RBC Capital Markets has provided a verbal opinion to the ARC board, to the effect that, as of the date of such opinion and based upon and subject to the assumptions, limitations and qualifications set forth therein, the consideration to be received by ARC shareholders pursuant to the Arrangement is fair, from a financial point of view, to ARC Shareholders.
A copy of RBC Capital Markets’ written fairness opinion, as well as additional details regarding the terms and conditions of the arrangement and the transaction and the rationale for the recommendation by ARC’s Board, will be included in the circular and other materials to be mailed to ARC Shareholders in connection with the ARC Shareholder Meeting to approve the transaction.
Burnet, Duckworth & Palmer LLP is acting as lead legal counsel to ARC.
Freshfields LLP is acting as UK counsel and US corporate, securities and tax counsel, and Baker Botts LLP is acting as US regulatory counsel to ARC.
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