1. BP acquisition of Amoco facts and summary?

Expert Solution

In mid-1998, the Oil and petroleum industry was witnessing a series of consolidations so as to reduce the number of players and reduce competition. British petroleum believed that the consolidation in the oil industry would leave the company behind and it was in a hurry to complete a series or mergers to remain as a fierce competitor. Therefore, between Mid-1998 and 2000, BP completed a series of acquisitions and bough Amoco, Arco and Castrol. The total size of all these acquisitions was in the range of 120 Billion US dollars. Within 100-days of the acquisition, BP reduced cost and laid-off more than 6000 employees of Amoco and imposed the BP style of management structure and the company was amalgamated with British petroleum.

The Summary is as follows:

1. Total Amoco deal Cost: $48.2 Billion

2. After acquisition, BP had become the third largest oil producer after Exxon Mobil and Shell Oil

3. Two companies employ about 100,000 workers worldwide

4. There were expected to be 5,000-6,000 job cuts

5. Once the deal was announced, oil prices fell to a 10-year low

jeff jeffy answered 2 years ago

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