ExxonMobil considering a $100-billion gamble on BP?
12 July 2010
Is Rex Tillerson, the CEO of Exxon Mobil, the world's largest publicly traded oil and gas company, inclined to take a $100-billion gamble on acquiring his besieged transatlantic rival BP?
Media reports suggests that ExxonMobil, formed through the merger of Exxon and Mobil in 1999, has received the nod from the Obama administration to ''take a look'' at BP with a view to acquiring it.
Media speculation of a potential takeover by Exxon Mobil sent the London-based BP's stock price shooting up by 5.8 per cent in London's early morning trades today, although it is still down by 42 per cent since the Deepwater Horizon rig exploded and sank on 20 April, setting off the world's longest-running deep sea oil spill.
With the market value of BP falling to about $94 billion from $181 billion as on 31 December 2009, opinion pieces, rumours and media reports have been suggesting since the past month that BP is a potential takeover candidate.
Standard Charted Bank, which has wide operations in Asia, said late last month in a note that PetroChina would be the ideal bidder for BP, while JP Morgan Cazenove analyst Fred Lucas had published a note last week outlining a possible scenario where US oil major ExxonMobil could cast its net over BP.
though Exxon Mobil has declined to comment, the Sunday Times yesterday reported citing oil industry sources that ExxonMobil has been given a green light by the US government to "take a look" at BP.