Exclusive: #UAE's ADNOC recently eyed BP as takeover target, sources say | Reuters

Exclusive: UAE's ADNOC recently eyed BP as takeover target, sources say | Reuters

The United Arab Emirates' state-owned oil company recently considered buying Britain's BP (BP.L), opens new tab but the deliberations did not progress beyond preliminary discussions, people familiar with the matter told Reuters.

Abu Dhabi National Oil Company (ADNOC) ultimately decided BP would not be the right fit for its strategy, three people said. Political considerations also weighed on the potential move, one of the people said.

The 88 billion-pound ($110.3 billion) company has underperformed its competitors for years, which investors and analysts say has made the British firm a potential takeover target. U.S. oil giants are in the midst of the industry's biggest consolidation for decades, but European oil majors have to date not been involved.

Investors have penalized BP's plan to reduce fossil fuel production and its faster shift toward renewables than rivals such as Shell, Exxon and Chevron. In February 2023, BP rowed back on its more aggressive energy transition plans.

ADNOC, in contrast, has increased oil and gas production capacity and CEO Sultan al-Jaber is seeking to reshape the state giant in the image of a global oil major. The company, which is not publicly traded, is big enough to consider acquiring the smaller of the oil majors, BP.

ADNOC and BP spoke directly in recent months and ADNOC also sought advice from investment banks on a potential deal, two of the people said.