BP shares jumped on Monday following Bloomberg reports that activist investor Elliot Investment Management had built a stake in the oil major and intends to pressure BP’s management to rethink their approach.
The specific stake hasn’t been revealed, but it is said to be significant. BP shares were over 6% higher at the time of writing.
Elliot Investment Management is one of the world’s largest activist investors and regularly takes stakes in companies with a view of shaking up their strategy. Elsewhere in the UK, the hedge fund built stakes in Anglo American and the Scottish Mortgage Investment Trust last year.
BP is an easy target. Its shares are down heavily over the past year, and it trades at a discount to its peers in the US and even many in Europe.
The company has flip-flopped on its green energy transition strategy, leaving investors questioning where BP sees itself going over the coming years.
That said, it pays a robust dividend, making it an attractive target for an activist investor to deploy capital and work away at shaping its future.
Reports of Elliot’s stake come shortly before a BP investor day in late February when CEO Murray Auchincloss will outline the company’s plans.