Oil giant BP (NYSE:BP) has been thrust into the spotlight as a prime takeover candidate — but energy analysts question whether any of the likeliest suitors will rise to the occasion.
Britain’s beleaguered energy giant, which holds its annual general meeting on Thursday, has recently sought to resolve something of an identity crisis by launching a fundamental reset.
Seeking to rebuild investor confidence, BP in February pledged to slash renewable spending and boost annual expenditure on its core business of oil and gas. CEO Murray Auchincloss has said that the pivot is starting to attract “significant interest” in the firm’s non-core assets.
BP’s green strategy U-turn follows a protracted period of underperformance relative to its industry peers, with its depressed share price reigniting speculation of a prospective tie-up with domestic rival Shell (NYSE:SHEL). U.S. oil giants Exxon Mobil (NYSE:XOM) and Chevron (NYSE:CVX) have also been touted as possible suitors for the £54.75-billion ($71.61-billion) oil major.
Shell declined to comment on the speculation. Spokespersons for BP, Exxon and Chevron did not respond to a request for comment when asked by reporters.
“Certainly, BP is a potential takeover target — no doubt about that,” Maurizio Carulli, energy and materials analyst at Quilter Cheviot, told the media.
BP shares opened Tuesday hiked 72 cents, or 2.6%, to $27.63.