Bp/Amoco Merger Acquisition

6130 Words Jan 28th, 2013 25 Pages
| BP Amoco/Arco Merger | Merger and Acquisitions Term Paper | | | 12/10/2012 |

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Contents Time Line of Events 3 Introduction 4 Industry Analysis 5 Overview of ARCO 's Business 7 Overview of BP Amoco’s Business 7 Value Creation from the Merger: 8 Competitors Analysis 9 Antitrust Issues 11 FTC Arguments 12 What Happened? 14 Divestitures 14 Phillips Acquires ARCO Alaska 15 FTC dissent 16 Performance and key Financials 17 Annual Shareholder’s meeting: 19 Conclusion: 20

Time Line of Events April 01, 1999: Merger confirmed by BP & ARCO. Deal valued at $26.8 bill. 400 layoffs expected in AK (2000 worldwide); Gov. announces formation of task force consisting of Attorney General
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Governor issues press release applauding announcement and asserting that the deal preserves most points from his Charter Agreement. | | March 21, 2000: Merger Committee sends letter to FTC Chairman Robert Pitofsky endorsing Phillips Petroleum 's purchase of ARCO Alaska 's assets, signed by Halford, Pearce & Porter. Merger committee issues release endorsing Phillips ' acquisition of ARCO Alaska 's assets and recommending FTC Approval of BP/ARCO Merger. | | March 24, 2000: Exxon sues to block merger.April 26, 2000: Phillips Petroleum announces it has completed its acquisition of ARCO 's Alaskan businesses. | | |

Introduction
In March 1999 British Petroleum Amoco (BP) announced its intention to acquire the Atlantic Richfield Company (ARCO) for $25.6 billion in stock, by exchanging 1.64 BPA U.S. ADR share for every outstanding share of ARCO (9.84 U.K. ordinary share), post-BPA stock split. On 1 April 1999 the Boards of BP Amoco and ARCO announced that they had reached agreement on a proposed combination of their two companies. The enlarged group will initially be held as to 85% by BP Amoco shareholders and 15% by ARCO shareholders. The BP/ARCO deal was one of the largest oil mergers ever and attracted a lot of public attention as well as antitrust scrutiny. The merger raised fundamental antitrust concerns that could be alleviated only by major

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