Physical Address
304 North Cardinal St.
Dorchester Center, MA 02124
The British Oil Major BP logo.
Sopa images | Lightrocket | Getty images
For weeks, market languages have stirred a potential merger between British oil giants – until the weeks of speculation ended Thursday that Shell denied information that he is in talks to acquire BP.
But how did we come to the point that BP, a British oil exploration company which was founded in 1909 under the name of Anglo-Persian Oil Company, is now considered as a possible takeover objective for its long-standing rival?
Reset
In 2020, under the direction of the CEO Newly appointed Bernard Looney, BP announced that she would embark on a strategy to redo as a “A net-zero company by 2050 or earlier” “ While increasing its investment in renewable energy projects. The energy giant is committed to “playing while transforming” when he has established this new strategy.
At the time, Looney admitted that change would be a challenge but argued that it was “also a great opportunity”.
Rafale Initial
Looney launched the strategy as well as the COVVI-19 pandemic made its way around the world, triggering a shock from demand and crampting crude prices. The energy giant posted its first loss in a full year in a decade, but the company has redesigned its, displaying an annual profit in 2021 of $ 7.6 billion – before more than triple to 27.65 billion dollars in 2022, while the invasion of Ukraine by Russia has increased oil prices.
BP action price.
Looney praised the results, telling CNBC The company was now leaning on its strategy.
“We are announcing up to $ 8 billion in the energy transition this decade and up to $ 8 billion more in oil and gas in support of energy security and energy affordability,” he said.
This increased investment in the company’s energy transition has been reinforced by forecasts, published in the 2023 BP edition Energy perspectivesthat the share of fossil fuels in primary energy would drop from around 80% in 2019 to 20% in 2050.
Looney Part
BP was left in shock when Bernard Looney suddenly announced his resignation in September 2023 after less than four years of work, the company revealing that it had not been “entirely transparent in its previous disclosure” on relations at the workplace before becoming CEG.
Then, the financial director Murray Auchincloss intervened as an interim CEO before being appointed permanent in January 2024.
But the man who had motivated the vision of BP as a giant of renewable energies was now outside the building.
Speculation supports
The drop in annual profits in 2023 and 2024, as well as the departure of Looney and a continuous sub-performance in BP actions compared to its peers, have raised new questions on the strategy of the major oil and its future as an autonomous company. Apart from Shell, Chevron and Exxon Mobil were also presented as potential contenders for BP, while the Emirates’s DNOC would have looked at some of its gas assets.
Activist investor Elliott would have built participation in the major oil in February, just before the revelation of Auchincloss Strategic reset of BP This decided to invest in oil and gas and reduce renewable energies. Investors have not yet been impressed, shares decreased by 15% since then.
Addressing CNBC in AprilAuchincloss rejected the concerns that the company became a buyout target, saying: “We are a strong and independent company. His peer, the CEO of Shell, Wael Sawan, was waiting for CNBC in June That “we have a very high bar” for mergers and acquisitions opportunities, but argued that the company continues to promote the repurchase of its own actions.
What is the next step
Shell’s robust rejection of these reports seems to have, for the moment, thrown cold water on a potential takeover offer for BP. The main analyst of Morningstar’s actions, Allen Good, questioned the advantages of a shell agreement for BP at this stage, telling CNBC that “unless the evaluation is super attractive”, so it would probably not be worth the headache for managers.
