Shell (NYSE:SHEL) (LON:SHEL) on Thursday denied it was planning a takeover of BP (NYSE:BP), saying it is not pursuing a bid and is not actively considering one.
The company also said that under U.K. regulations, making such a statement prevents it from making a formal offer for the next six months.
The response came after a Wall Street Journal (WSJ) report on Wednesday claimed Shell was in discussions to acquire BP.
“In response to recent media speculation Shell wishes to clarify that it has not been actively considering making an offer for BP and confirms it has not made an approach to, and no talks have taken place with, BP with regards to a possible offer,” the oil giant said in the release.
“This is a statement to which Rule 2.8 of the Code applies and accordingly Shell confirms it has no intention of making an offer for BP. As a result Shell will be bound by the restrictions set out in Rule 2.8 of the Code,” it added.
The WSJ reported that Shell was in “early-stage talks” to buy BP, citing sources familiar with the matter. The report said that the discussions between the two companies are “active,” with BP said to be weighing the approach “carefully.”
A potential acquisition of BP would present significant challenges for Shell, including a lengthy integration process, cultural differences, and likely divestments of overlapping assets.
However, such a move could expand Shell’s already significant trading footprint and strengthen its position in key areas like liquefied natural gas.
