Exxon Mobil has started a legal action that could block BP Amoco’s planned $40bn acquisition of the US oil company Arco.
Exxon applied for an injunction in the Los Angeles state court at the end of last week to stop the sale of Arco’s Alaskan assets to Phillips Petroleum for $7bn. This sale, agreed earlier in the month, persuaded the US Federal Trade Commission to drop its objection to BP Amoco’s takeover of Arco.
The suit claims that Exxon Mobil has rights to match any bid for Arco’s Prudoe Bay assets under an exploration agreement signed 36 years ago.
BP Amoco disputes this on the ground that the sale involved the corporate entity of Arco Alaska rather than individual assets. `We don’t believe Exxon has any pre-emption rights,’ said a spokesman. However, the company will await the FTC’s response to the development before taking any counter-action.
Analysts speculated that the move was an attempt by the giant US company to clip the wings of a British competitor that has recently begun to threaten its position as the world’s leading private oil company.