“You can absolutely make the case that it’s a potential takeover target” once BP’s US settlement and the Russia deal are completed
The Financial Times quotes some observers as saying that BP is unlikely to proceed with the share buyback until after it has settled all remaining Gulf of Mexico claims. In the meantime, however, the UK oil company is seen as a potential takeover target, with Bloomberg reporting that it is the cheapest of the world’s five biggest non-state oil companies by market value relative to reserves, earnings and output.
“You can absolutely make the case that it’s a potential takeover target” once BP’s US settlement and the Russia deal are completed, notes Julian Birkinshaw, a professor of strategy and entrepreneurship at the London Business School, as quoted by Bloomberg. “BP has been fighting wars on both the eastern and western fronts” which held back buyers.
The Sunday Times reports that Royal Dutch Shell (LON:RDSA, LON:RDSB, NYSE:RDS.A, NYSE:RDS.B) has considered a bid for BP in the past, whereas Chevron (NYSE:CVX) is another possible suitor. Yet, Bloomberg quotes BP’s CEO Bob Dudley as saying that the company’s size would make a takeover attempt “very surprising” and would likely create regulatory objections. “The main thing would be that we continue to perform and grow,” noted Mr Dudley, adding that a takeover was not “in the best interest of our shareholders.”