(Bloomberg) — Shell Plc denied a Wall Street Journal report that it is in active talks about acquiring its London-based oil rival bp Plc.
“This is further market speculation. No talks are taking place,” a Shell spokesperson said.
bp surged as much as 10% in New York earlier on Wednesday on the report that it was in early-stage takeover talks with Shell. Shares of the company erased most of those gains to trade 1.2% higher as of 12:44 p.m. local time.
bp has been under intense pressure after years of poor performance and the intervention of activist shareholder Elliott Investment Management. A strategy “reset” announced in February by Chief Executive Officer Murray Auchincloss got a lukewarm reception, as analysts and investors questioned whether the company could achieve its goals of rising oil and gas production and improving returns.
Speculation has been growing that the embattled company would become a takeover target, although bp’s size and complexity would make any deal very challenging. Bloomberg reported in May that Shell had been studying the merits of a takeover, but was waiting for further stock and oil price declines before deciding whether to pursue a bid.
