BG has appointed a new chief executive but, sadly for him, the company's shares have immediately deflated.
The gas giant has given the top job to Chris Finlayson, a current director who joined from Royal Dutch Shell in 2010, after a year long search. He replaces Frank Chapman, who has held the helm for 12 years and turned the group into a global business, albeit a warning on output at the end of October slightly soured things, sending the company's shares lower and prompting some to tip it as a takeover target. Analyst Gordon Gray at Canaccord Genuity said the move resolved uncertainty but added:
Some in the market may initially view an internal appointment as a slight negative - following the recent issues over production guidance, there was increased expectation of an external hire.
That appears to be the case, with BG's shares down 18.5p at 1046.5p. But Canaccord's Gray added:
Overall, we view the succession as positive, and it is helpful that he will assume the role as soon as next month. The market will look for his updated view on BG's growth outlook and we think there's a high chance that its 2015 volume target will have to be cut. However, we think this is largely expected after the shares' sharp fall and the hit to investor confidence. Importantly, we still see strong long-term growth prospects.
Elsewhere in the energy sector, services business Wood Group is leading the FTSE 100 fallers, down 27p at 741.5p after analysts said an update from the services business indicated growth in its engineering division could slow next year.
