UK government tells BP it would oppose takeover

UK government tells BP it would oppose takeover

LONDON - Agence France-Presse
UK government tells BP it would oppose takeover

AFP Photo

The British government has warned oil giant BP that it would oppose a foreign takeover of the company weakened in recent years by the Gulf of Mexico oil spill, media reports said on April 27.

“The government has met with BP in recent days to express its opposition to any potential takeover of the oil major,” the Daily Telegraph reported.

The Financial Times cited British officials saying that Prime Minister David Cameron’s office would be “skeptical” about any potential takeover deal.

The warnings come as some analysts say BP could become a takeover target because it has been forced to sell off assets following the Deepwater Horizon rig spill in 2010, and because of lower oil prices.

“The government talks to a wide range of U.K. businesses, as you would expect,” Cameron’s press office said in a statement.

“It is in the U.K.’s interest to have British companies competing and succeeding at home and abroad,” he said.

The government has few formal powers to block a takeover and this type of intervention is unusual.

On the London Stock Exchange, BP shares were down 1.16 percent at 472.85 pence by 1110 GMT, whereas the benchmark market index was up 0.30 percent.

“One would expect any takeover of BP to have to be fairly predatory and for the oil major to not go lightly,” said Will Hedden, a dealer at London Capital Group.

Energy titan Royal Dutch Shell earlier this month announced a mega-takeover of British rival BG Group worth 47 billion ($71.1 billion), consolidating their positions in a sector battered by sliding oil prices.