Shell studies merit to buy BP, Bloomberg News reports

(Reuters) -Hell PLC works with advisers to evaluate a potential acquisition of the BP PLC opponent, although he hopes that the shares and the oil price will decide before deciding if an offer was made, Bloomberg News reported on Saturday quoting people who know the matter.

The largest of oil has been more seriously discussing the viability and merits of a taking over with his advisers in recent weeks, according to any final decision will depend on whether the opponent’s actions continue to slip.

For several years, BP and Shell were almost the same, but in recent years Shell has grown to double the BP size, with a market value of about 149 billion pounds.

On Friday, when asked about a possible acquisition offer for BP, Wael Sawan, the CEO of Shell, told The Financial Times that he would prefer to buy more Shell shares again. A spokesman for Shell confirmed the comments.

When asked about a earnings call about Shell’s ability to launch important acquisitions, he said “we must have our own house in order” and have “more work to do” despite advances for the past two years.

A taking over his London opponent would make Shell an even greater force in the world energy industry, giving him a scale to rival Exxon and Chevron. A fusion would also undoubtedly invite a regulatory scrutiny, taking into account the size of the agreement.

Shell this week had strong results from the first quarter that exceeded profit expectations and launched a shares of $ 3.5 billion.

Shell can also wait for BP to arrive or for another pretender to take a first step, and his current work could help him to prepare for a stage, as some of the people told Bloomberg News.

The deliberations are in the early stages and Shell may choose to focus on the participation rewards and Bolt-on’s acquisitions instead of Megameger, the report added.

“As we have said many times before we focus abruptly on capturing the value of Shell through continuing to focus on performance, discipline and simplification,” said a spokesman for Shell when asked about the report. BP refused to comment.

Under pressure to improve the profitability and reduction of costs, BP chief Murray Auchinloss has announced plans for selling $ 20 billion assets to 2027, reduced expenditure and the coming of the shares. He also announced the departure of his head of strategy, as he tries to reduce the confidence of investors.

The activist investor Elliott Investment Management had wanted a change in strategy, as he sought a higher free cash flow through deeper cuts of expenses and costs, according to FourS sources told by the matter.