Royal Dutch Shell Plc won shareholder approval to buy BG Group Plc, sealing its biggest acquisition amid the worst oil-industry slump since the global financial crisis.

More than 83 percent of Shell shareholders voted in favor of the transaction, the company said in a statement. Most votes were cast by proxy while other investors met in The Hague on Wednesday.

The approval vindicates Shell’s belief that it can better ride out the market rout by combining with U.K. oil and gas producer BG. Crude’s tumble since the deal was announced in April prompted some shareholders to question whether it’s paying too much, yet Chief Executive Officer Ben Van Beurden has said the acquisition will boost cash flow and enhance Shell’s ability to pay dividends, while BG’s growing production will help bolster its declining output.

Shareholders have shown confidence in the “strategic logic of the combination,” Van Beurden said in the statement.

The planned acquisition, which will also make Shell the world’s biggest liquefied natural gas trader, now faces a vote by BG investors on Thursday and final court approval before the deal can close in mid-February.

Boosting Resilience

“The enlarged group has stronger growth potential, will benefit from further synergies and cost reductions, is more resilient in a lower price environment and can maintain the dividend,” Tudor, Pickering, Holt & Co., the Houston-based oil investment bank, said in a note after the result was published.

David Fuller's view

Needless to say the purchase of BG Group by Royal Dutch Shell B (est p/e 12.26% & yield 8.62%) has become a somewhat controversial decision following the slump in oil prices.  RDSB definitely paid up for BG when the bid was announced, largely because it wanted to pre-empt a contested bid, fearing that one or two of the leading US oil companies might become involved.  That never happened, not least because the price of crude oil fell, so BG shareholders were clearly beneficiaries of the takeover.

I have held Royal Dutch Shell B in my personal long-term investment accounts for many years, sometimes adding to this holding on weakness, usually by reinvesting dividends.  I also know that a number of subscribers also own the share.  Naturally it has been discouraging to see how far RDSB has fallen, but at least we have been paid for our patience.  While there are few certainties in markets, I have remained hopeful that RDSB would maintain its dividend, not least because specialists in this field have also expressed a similar view, the latest being Tudor, Picker, Hold & Co, mentioned above.