BP eyes stake sale as spill cost tops $3 b

BP eyes stake sale as spill cost tops $3 b

Over the weekend, while US Independence Day holidaymakers shunned Gulf of Mexico beaches tarred by leaking well, media reports said BP was looking for a strategic investor among the sovereign wealth funds of the Middle East and Asia.An investor would help ward off a takeover and raise funds for the liabilities racking up behind the worst oil spill in US history, reports said.

Shareholders, however, balked at the idea of a strategic investor. “We don’t think a strategic partner is at all necessary,” said one top-10 BP shareholder, who did not want to be named. “We think this is just people trying to panic the company and stampede into doing something to earn huge fees from selling new shares in BP. Shareholders will be saying ‘No, thank you’ to this and we have communicated this to the company.”

Another top-10 investor agreed that BP “probably did not” need a strategic investor at the moment. Britain’s Sunday Times said BP’s advisers were trying to drum up interest among rival oil groups and sovereign wealth funds to take a stake of between 5 and 10 per cent at a cost of up to £6 billion ($9.1 billion). BP declined to comment. Separately, several newspapers reported interest among sovereign wealth funds in buying some of BP’s assets in the Middle East and Asia. BP has said it hopes to raise $10 billion from asset sales this year as part of its plan to fund a $20 billion clean-up fund set up under pressure from US authorities.

BP said, on Monday, it had so far spent $3.12 billion on the response effort, including $147 million paid out in claims to those affected by the disaster.