① European energy giants such as Total and Shell are considering moving their listing locations to the US because their market value is significantly lower than their US peers, such as ExxonMobil and Chevron; ② French President Emmanuel Macron said that the country's energy giant Total should continue to be listed on the mainland rather than go to the US.
FINANCE PRESIDENT, May 22 (Editor Xia Junxiong) French President Emmanuel Macron said that the country's energy giant Total should continue to be listed on the mainland instead of going to the US.
European energy giants such as Total and Shell are considering moving their listing to the US because their market capitalization is significantly lower than their US peers, such as ExxonMobil and Chevron.
European energy company executives believe that, from investors to regulators, the European market is not friendly to fossil fuel companies. In contrast, the US stock market is more tolerant, and this is the main reason for the large market value gap between oil and gas companies in the US and Europe.
Total CEO Patrick Pouyanne said last month that Total is seriously considering the possibility of listing in New York to make it easier for US investors to buy the company's shares. According to reports, Total's board of directors has requested Pouyanne to study the transfer of the listing site to the US and submit a relevant report by September.
In a media interview released on Wednesday, Macron made a statement on the matter. He said, “France is accompanied by those who believe in France, not others.”
Macron said, “I think Total has never complained about its French identity in the export market, and it is in their interest to stay in France.”
As one of the world's largest energy giants, Total is currently listed in Paris, France. It is the fourth largest company in the French CAC 40 Index, accounting for 6% of the total market value of the stock market. If Total were to change its listing location, it would damage Paris' status as an international trade center.
Pouyanne said this month, “We have more and more American shareholders and fewer European shareholders (including French shareholders), probably because of disputes over ESG and other issues.” He stressed that even if Total eventually chooses to enter Wall Street, it will continue to list in France. The implication is that the company may adopt a dual listing structure.
Citibank analysts said earlier that it is very unlikely that Total and Shell will eventually go public in the US.
Some analysts believe that the low market value of European energy companies cannot be entirely blamed on the European market being unfriendly to fossil fuel companies. According to investors, ExxonMobil and Chevron's practice of handing out cash to shareholders is sustainable, while Shell and British Petroleum cut dividends to save cash after the COVID-19 outbreak.