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- BP shares surged 8% after an activist hedge fund took a stake in the company.
- It was reported over the weekend that Elliott Management had taken a stake in the energy giant.
- BP’s share price has fallen in the past year as it struggles to improve performance and cut costs.
Energy giant BP’s shares have soared after activist hedge fund Elliott Investment Management revealed it has taken a stake in the British company.
Shares in BP rose by as much as 8.2% in early London trading on Monday before paring gains to trade up by around 6% at 10:45 a.m. GMT (5:45 a.m. ET).
The news of New York-headquartered Elliott acquiring a significant holding in the energy firm broke over the weekend, though the size of the position is not yet publicly known.
Elliott, founded and presided over by billionaire Paul Singer, is one of the world’s best-known activist investors, known for its aggressive attempts to bring change to the companies it invests in.
In 2024, for instance, soon after investing, Elliott pushed Southwest Airlines to make significant alterations to its business to become more profitable. The push helped bring major changes, such as Southwest ditching its long-standing policy of no assigned seats.
While it is unclear what Elliott may want to change at BP, one analyst suggested it could push to split parts of BP’s core oil and gas business and seek a change in management.
“In terms of strategic business reviews, we would expect a push to effectively split up the core oil and gas segment to some of BP’s transition growth engines, in order to help minimize capital into these areas,” Biraj Borkhataria, a capital markets analyst at RBC, said.
“We think any activist would call for a change in the chairperson at the very least,” he added.
The move comes after BP’s share price slumped more than 10% in 2024.
BP has struggled in recent years as it attempts to balance its core businesses, like oil and gas, with renewable energy. Previous CEO Bernard Looney had spearheaded major renewable investments during his tenure before resigning in September 2023 after it was revealed he had misled BP’s board over previous relationships with staff.
New CEO Murray Auchincloss has pushed efforts to cut costs in the business and, in January, announced that BP would cut almost 8,000 jobs across the company’s staff and contractors.
