BP shares climb after FT reports of several rivals exploring a takeover

Investing.com -- BP (NYSE: BP) shares moved slightly higher on Friday following a Financial Times (FT) report that several major energy companies have evaluated a potential takeover of the U.K.-listed group

According to industry sources and advisers cited by the FT, Shell (LON: SHEL), Chevron (NYSE: CVX), ExxonMobil (NYSE: XOM), TotalEnergies (EPA: TTEF), and Abu Dhabi’s Adnoc (ADX:ADNOCDIST) have all "run the numbers" on BP. Oil trading giant Vitol is also said to be interested in parts of the business.

BP’s shares rose more than 2.6% in London, while its U.S.-listed shares added 1.5% in the premarket trade by 08:10 GMT.

A sum-of-the-parts valuation indicates BP’s assets are worth over £120 billion, excluding debt and other liabilities—more than double its current market value of £57 billion, which has been hit by a sharp decline in the stock over the past year.

“The continued underperformance of BP makes it open to a takeover,” a person close to activist investor Elliott Management reportedly told the FT. Elliot holds a significant position in the company.

M&A teams at large oil firms frequently review the strategic logic of major deals. While acquiring BP would be complicated and raise regulatory and political issues, the scale of the opportunity is substantial.

UBS analyst Joshua Stone estimates that BP’s oil and gas assets—including those in the Gulf of Mexico and its U.S. shale operations—are worth $82 billion, exceeding its market capitalisation.

However, the group remains burdened by $77 billion in debt and long-term obligations, including those linked to the 2010 Deepwater Horizon disaster.

For Shell, a takeover of BP would be transformative, potentially creating an energy powerhouse producing nearly 5 million barrels of oil and gas per day—surpassing both ExxonMobil and Chevron.

The combined entity would command up to a quarter of the global LNG market and hold a strong position in the U.S.

The most attractive part of BP’s portfolio for Shell is its gas and LNG operations. Shell CEO Wael Sawan recently told the FT that he aimed for the company to be “the undisputed leader in integrated gas and LNG.”

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