(MENAFN) According to informed sources speaking to Reuters, the Abu Dhabi National Oil Company (ADNOC) recently entertained the idea of purchasing the British energy giant BP. However, discussions on this matter did not progress beyond preliminary stages. Three separate sources familiar with the matter revealed that ADNOC ultimately concluded that BP did not align with its strategic objectives. One of the sources suggested that political factors also played a role in this decision-making process.
BP, valued at 88 billion pounds (USD110.3 billion), has faced declining performance in comparison to its industry peers for several years, rendering it a potential target for acquisition, as suggested by investors and analysts. While major US oil corporations are undergoing significant mergers, European counterparts, including BP, have not yet been involved in similar activities.
Investors have expressed discontent with BP's strategy, particularly its plans to reduce fossil fuel production and accelerate its transition towards renewable energy sources, which diverges from the approaches of competitors like Shell, Exxon, and Chevron. In February of last year, BP retreated from its ambitious energy transition plans, eliciting further skepticism from investors.
In contrast, ADNOC has been expanding its oil and gas production capacity under the leadership of CEO Sultan Al Jaber, with ambitions to position the state-owned entity as a prominent global player in the oil industry. Despite being an unlisted company, ADNOC boasts substantial financial clout, making it theoretically capable of considering the acquisition of BP, which is comparatively smaller among industry giants.
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