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Shell Denies Talks to Acquire BP, Invokes Six-Month Takeover Ban

The six-month bid prohibition follows Shell’s official denial of takeover talks, highlighting regulatory hurdles that complicate any merger

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Overview

  • Shell has formally denied media reports of takeover negotiations and invoked the UK Takeover Code, preventing any bid for BP for at least six months.
  • UK Competition and Markets Authority and European Union regulators are expected to present significant antitrust hurdles that industry experts say make a merger unlikely.
  • BP’s share price has lagged behind peers following strategic pivots and a first-quarter profit shortfall, leaving the company under renewed pressure from activist investors.
  • Shell has focused on cost reductions and returned £2.5 billion to shareholders through a recent buyback, with CEO Wael Sawan emphasizing share repurchases over acquisitions.
  • A combined Shell-BP entity would reach an estimated £211 billion market value, but analysts question whether the potential scale would deliver net benefits given the firms’ contrasting strategies.