Blood in the water - So the chances have grown that one of #BP’s rivals will seek to capitalise on its weakness and bid for it. Although its value has fallen sharply, its market capitalisation is still $107 billion, so the list of possible buyers is short. The most talked-about potential suitors are #Exxon Mobil (market value $380 billion) and #Shell ($197 billion), with #Chevron ($196 billion) as a possible “white knight” merger partner to fend off the other two. There are some state oil and gas firms big enough to afford BP (the Saudi, Qatari or Kuwaiti ones, say), but none seems to be in shopping mood just now. All the firms involved decline to comment. But it is easy to see some advantages to a takeover by Exxon. The two companies fit, in that Exxon’s American business is smaller than its international operations. And BP, though nominally British, is strongest in America. Exxon has lots of cash and low borrowing costs. It did a good job of absorbing Mobil, another rival, in 1999. Moreover, the biggest blight on the BP share price is its American lawsuits. It has handled these badly. Exxon, with its unrivalled political clout, might do better.
Posted on: Thu, 15 Jan 2015 21:15:50 +0000
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