shell Refusing to get competitors’ denial doubles bpclaiming it “unintentionally” prohibits bidding with BP for the next six months while invoking British law, with few exceptions.
June 26th news Reporting Shell participated in early talks to buy BP, which could easily represent the largest energy deal of the century–if never. But as Shell appears to be focusing on internal performance for the time being (at least for now), BP, which is struggling financially, has no other clear suitors as the UK energy giant After seeking a turnaround “Hard reset” by reducing costs, greater investment in fossil fuels and renewable energy divestment.
“In response to recent media speculation, Shell wants to clarify that it has not actively considered making an offer to BP and confirm that it has not taken any approach and has not negotiated with BP about possible offers.”
The statement was issued under the rules of the UK Acquisition Code, which prohibits backtracking of its claims within the next six months unless Shell reaches a BP board agreement, another company bids on BP, or the situation changes significantly. Citing the code allows Shell to better assure investors that it is focused on its strategy rather than large-scale, debt acquisitions.
BP declined to comment.
In the June 25 report, Shell’s statement was Wall Street Journal That Shell is having an early conversation with the possible BP, which also happened after previous speculation and reported that Shell is working on a possible deal to combine the two largest oil giants.
“At present, any takeover of BP by Shell will be the story of 2026 and is unlikely to happen in 2025,” said Kathleen Brooks, research director at XTB Brokerage. “BP’s stock price is still not enough to represent its global peers, and now Shell’s run as a potential buyer, we don’t see BP fixing its position in the coming weeks or months.”
Huge trading challenge
Indeed, only a few companies have the ability to obtain BP with their massive but underperforming market capitalization. London-based Shell is the most obvious, but others –ExxonMobil and Chevron – its own massive acquisition. Even the U.S. super jors could face greater antitrust challenges, said Deborah Byers, senior consultant at energy research and investment firm Veriten.
It is worth noting that Shell moved its headquarters from the Netherlands to London three years ago, changing the Royal Dutch name to Shell.
“I think the British government will block foreign purchases. Maybe Shell is the White Knight, from a UK regulatory perspective, they will be fine,” Byles said. “You would think the UK wouldn’t accept anyone outside Shell, even the US professional.”
Byles said it is not to consider all debt, employees and nation-state regulatory approval, and Shell will have to pay another global energy super-transcendent. Shell and BP each employ nearly 100,000 employees, although they are both currently downsizing, while Exxon Mobil has about 60,000 employees. Shell will then need a prolonged divestment to meet the balance sheet and antitrust issues of different countries.
“Why (Shell) do this?” Byers said. “Does shareholders really want growth? Or do they just want capital discipline and returns, whether it’s dividends or buybacks? It’s been a while since someone has gained growth in this space.”
She said BP shareholders “have to be patient” as it attempts to reset the financial reset and admitted that BP is dealing with investor activism at Elliott Investment Management and others.
“The challenge is, what is that patience schedule?” Byers said. “Their patience may be three-quarters or three-quarters, but it may take them several years to really address some of these strategic hubs.”
Similarly, in a recent analyst noted that Biraj Borkhataria of RBC Capital Markets said that BP’s debt status, including the remaining liability for the 2010 Deepwater Horizon tragedy, represents the “holy grail of poisoning for the acquisition of the home.”
“This deal looks to be related to most of Shell’s key metrics, and we don’t see the core strategic principles of the portfolio,” Borkhataria added. “Since early 2023, as Shell Management has been communicating its strategic focus to the market, the deal will also help contradict its investor base and potentially undermine its credibility. Shell will continue planning to continue planning and stay smaller and more focused.”
