Bankers, lawyers, and Wall Street are all anticipating the oil superpower’s next move. The consensus? Bankruptcy.

• Between the rapidly declining value of BP shares, the cleanup costs, and the anticipated lawsuits from gulf fisherman and tourism companies, it seems likely that BP is being primed for a takeover.
• Who’s interested? Both Shell and Exxon have the means to buy BP, and bankers believe now is the time to strike. Only problem is how to separate the deal from all the legal exposure.
• BP’s chief executive, Tony Hayward, insists that BP will foot the whole bill.
• According to the Oil Pollution Act of 1990, BP’s financial responsibility for the cleanup is capped at $75 million. But if it’s determined that safety regulations were violated (which is very likely), the cap is no longer relevant.

Facts & Figures

• BP has lost more than a third of its value since the Deepwater Horizon catastrophe.
• BP generated nearly $17 billion of profit last year.
• One estimate of the BP cleanup bill is more than $40 billion.
• If a court rules against the company, the cost of the spill could skyrocket into the hundreds of billions, almost guaranteeing the end of  BP.

Best Quote

“The strength of cash-flow generation in recent quarters has provided us with a balance sheet that allows us to fully take on the responsibility for the Gulf of Mexico response.” – Tony Hayward, Chief Executive of BP

Tags: bankruptcy, BP, chapter 11, company, deepwater, horizon, Oil, spill, value