Mergers & Acquisitions

BP Takeover Rumor Strikes Again

Major oil companies reportedly lining up to make play for oft-cited target

LONDON -- Rumors have resurfaced yet again of a BP takeover, this time focusing on Exxon Mobil Corp. as the aggressor, according to a report by the Evening Standard. A successful deal would be the biggest oil takeover of all time, but one that would most likely face opposition from the government, the newspaper said.

ExxonMobil has been sounding out BP’s major shareholders to gauge their interest in a potential takeover, the report said. The two companies have several top shareholders in common, including BlackRock and Vanguard.

The plot thickens

Royal Dutch Shell, based in The Hague, Netherlands, is supposedly ready to swoop in with a bid of its own to save the day and keep BP on British soil if Exxon makes an approach, said the report. Other interested parties are said to include San Ramon, Calif.-based Chevron Corp.

BP is thought to be concerned that it might be vulnerable to an offer above 600p ($7.29 U.S.) per share, worth nearly £120 billion. ($145.93 billion U.S.), the Evening Standard said. BP’s shareholders are thought to be unhappy with the share price, which at 458.6p ($5.57) is 30% below 650p ($7.89), the price BP was trading at in 2010 before the Deepwater Horizon disaster in the Gulf of Mexico.

Takeover talk has stalked BP ever since the huge oil spill dismantled the share price, the report said.

According to the chatter, BP is concerned impatient shareholders will urge it to do a deal if it can’t create value on its own.

ExxonMobil and BP told the Evening Standard that they do not comment on speculation.

Meanwhile, over in retail …

The takeover speculation comes as BP opens its first gas station and convenience store in Mexico, one of as many as 1,500 sites planned to open in the next five years, made possible by the country’s deregulation of the fuel retailing market.

London-based BP has more than 18,000 gas stations and c-stores in 19 countries around the world. In December 2016, BP and Woolworths Group agreed to enter a strategic partnership where BP will acquire and operate 527 retail sites in Australia, subject to regulatory approvals.

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